Skip to main content

SA 720 Revised For Auditor's responsibility relating to other information 01 April 2018

Scope

  • Responsibility to other information Included in Annual report
  • It can be Financial or non Financial
  • Example Director’s report/Corporate governance report
  • It is Not an assurance engagement 
  • Requirement of “Corporate” entity

Auditor’s Responsibility

  • Obtain Other Information Discuss with management 
    • Make appropriate arrangement to obtain these documents prior to AR 
    • If information is not available, then Request management to provide WR version of these documents
  • Reading of other information 
    • Objective is to find out material inconsistency between Other information and F.St. and/or Our understanding and reality 
    • Auditor shall Remain alert, about material misstatement (MM)

Responses to material inconsistency found

After Date of Audit report

  • Perform necessary procedures if other Info. Is corrected 
  • Receive corrections 
  • Take legal rights and obligations 
  • Right to hear: Discussion in general meeting 
  • If mistake is present in F.St. Apply SA 560

Reporting

  • Include a separate section “Other Information” in Audit R. 
  • Management is responsible for other information 
  • Identification of other info. 
  • Obtained prior to date of AR, and 
  • Expected to be obtained prior to date of AR (Listed) 
  • State that there is no opinion expressed on other info. 
  • Describe auditor’s responsibility 
  • Statement that there is no uncorrected MM on OI received before AR and whether there is nothing to report or other case 
  • Statement that “we will read other info. which is expected to be received”









Comments

Post a Comment

Popular posts from this blog

ICAI Suggested Answers Links

Course Paper Suggested Answers CA Final OLD Paper – 1 : Financial Reporting https://www.icai.org/post.html?post_id=10135 CA Final OLD Paper – 2 : Strategic Financial Management https://www.icai.org/post.html?post_id=10139 CA Final OLD Paper – 3 : Advanced Auditing and Professional Ethics https://www.icai.org/post.html?post_id=10145 CA Final OLD Paper – 4 : Corporate and Allied Laws https://www.icai.org/post.html?post_id=10150 CA Final OLD Paper – 5 : Advanced Management Accounting https://www.icai.org/post.html?post_id=10158 CA Final OLD Paper – 6 : Information Systems Control and Audit https://www.icai.org/post.html?post_id=10164 CA Final OLD Paper – 7 : Direct Tax Laws https://www.icai.org/post.html?post_id=10252 CA Final OLD Paper – 8 : Indirect Tax Laws https://www.icai.org/post.html?post_id=10253 CA Final NEW Paper-1: Financial Reporting...
2 comments
Read more

Similarities between Delhi and Sikkim

 Delhi and Sikkim are although very different in terms of culture, tradition and food however both have some similarities. The first similarity is the area, both Delhi and Sikkim are small where as Sikkim ranks twenty seventh in terms of covered area and similarly Delhi ranks thirty first in terms of covered area. There is high literacy rate in Delhi and Sikkim, Delhi literacy rate is 86.21% and Sikkim's literacy rate is 82.6% which is also thirteenth in rank. Delhi and Sikkim have high human development index, Delhi ranks Fifth with 0.746 HDI and Sikkim ranks tenth with 0.716 HDI. Both Delhi and Sikkim comes in Northern portion of India and shares almost same latitude. Both Delhi and Sikkim are great heritage of culture and language hub.
Post a Comment
Read more

Suggested answers May 2019 - Strategic Financial Management

Theory 7 (a) Credit rating is a very important indicator for prudence but it suffers from certain limitations. Some of the limitations are: (i) Conflict of Interest – The rating agency collects fees from the entity it rates leading to a conflict of interest. Since the rating market is very competitive, there is a distant possibility of such conflict entering into the rating system. (ii) Industry Specific rather than Company Specific – Downgrades are linked to industry rather than company performance. Agencies give importance to macro aspects and not to micro ones; overreact to existing conditions which come from optimistic / pessimistic views arising out of up / down turns. At times, value judgments are not ruled out. (iii) Rating Changes – Ratings given to instruments can change over a period of time. They have to be kept under constant watch. Downgrading of an instrument may not be timely enough to keep investors educated over such matters. (iv) Corporate Governance Issu...
1 comment
Read more