What main activity occurs during a hot review?

A hot review is a critical component of the audit process, typically conducted towards the end of the audit engagement just prior to the signing of the audit report. The primary purpose of this review is to ensure that all significant audit issues have been adequately addressed, the overall financial statements have been thoroughly examined, and that the auditor's conclusions are supported by the evidence gathered throughout the audit.

During the hot review, partners or senior auditors examine the work of the audit team, ensuring that the audit approach has been effective and in alignment with applicable accounting standards and auditing standards. This process serves as a form of quality control, emphasizing the importance of comprehensive review and assessment before finalizing the audit opinion and signing the audit report.

This distinguishes the hot review from other activities such as client interviews, which typically take place earlier in the audit process to gather information, and the examination of financial statements, which is an ongoing activity throughout the audit. Reviewing audit planning and strategies is usually done at the planning stage rather than right before the report is issued. The focus and timing of the hot review underscore its role in safeguarding the quality and integrity of the audit report.