emphasis of matter and other matter paragraphs

Question 1

. Know the definition of (and distinction between) emphasis-of-matter and other matter paragraphs in the auditor’s report.

2. Know the three matters for which an emphasis-of-matter paragraph is required.
3. Know how an emphasis-of-matter and/or other-matter paragraph would be presented in the auditor’s report.

Answer 1

d

Question 2

emphasis of matter paragraph

Answer 2

a paragraph that relates to a matter appropriately presented or disclosed in the financial statements, that in the auditors judgement, is of such importance that it is fundamental to users understanding of the financial statement.

Question 3

other matter paragraph

Answer 3

a paragraph that refers to a matter other than those presented or disclosed in the financial statements that, in the auditors judgment, is relevant to users understanding of the audit, the auditors responsibility, or auditor’s report

comes after opinion
appropriate heading
*matter outside f/s

Question 4

when is emphasis of matter paragraph is required

Answer 4

going concern issue
inconsistency in acc principles used
f/s are prepared in accordance with special purpose frameworks

may issue letter if (not required)
when uncertainty to litigation
major catastrophe
sig transactions with related parties
important subsequent events

Question 5

where can emphasis matter be found

Answer 5

only refer to stuff in the f/s
after opinion paragraph
state where disclosures can be found
state opinion not altered to matter emphasized

Question 6

required other matter paragraph may be issued

Answer 6

when the opinion currently expressed on prior years f/s is different than prior opinion

when reporting on one or more than one set of f/s (one using gaap and other using ifrs)

when its not possible for the auditor to withdrawl when then there is a scope limitation.