A4/M10 Communication with management and governance

Question 1

what are the requirements regarding auditor’s communication with governance?

Answer 1

• The auditor should communicate the disagreement regarding significant adjustments or deficiency with management to governance regardless if the matter resolved or not
• the auditor is not required to search for significant deficiencies in internal control
• the auditor must communicate both significant deficiencies and material weaknesses
• the auditor should communicate in writing again regarding previously communicated significant deficiencies; but does not require to communicate other deficiencies in PY even management chose not to correct the deficiencies
• All material weaknesses are significant deficiencies
• Auditor may communicate significant deficiencies during an audit or after audit’s completion
• the purpose of the audit was to report on the FS and NOT to provide assurance on IC
• auditor’s report on significant deficiencies should include a restrictions on the distribution of the report (solely for use of management, those charged with governance, and others within the org)
• DO NOT communicate about the probably high-risk audit procedures (avoid making them too predictable)