ISA 700 - FORMING AN OPINION AND REPORTING ON FINANCIAL STATEMENTS Flashcards
ISA 700
ISA 700
FORMING AN OPINION AND REPORTING ON FINANCIAL STATEMENTS
Unmodified Audit Report - CLEAN
In order to form the audit OPINION, the auditor shall conclude as to whether the auditor has obtained reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error. That conclusion shall take into account WHETHER:
S - Sufficient Appropriate Audit Evidence has been obtained (if not obtained > it will be a LIMITATION OF SCOPE!)
P - Presentation of F/S is appropriate (including structure) > MISSTATEMENT
R - Right basis of accounting has been used > MISSTATEMENT
E - Errors (misstatements) have not been corrected are material > MISSTATEMENT
A - Accounting policies are Consistent (IAS 8), Appropriate & Properly Disclosed > MISSTATEMENT
D - Disclosures required by IFRS or the law are adequate > MISSTATEMENT
ISA 700
The NEW Auditor’s Report
LISTED & PRIVATE
LISTED & PRIVATE ENTITIES
TAOB
T - Title
A - Addressee
O - Opinion
B - Basis for opinion
EMOKOO
E - EMPHASIS OF MATTER
M - MURGC para
O - Other Information (negative - inconsistency in Annual Report)
K - KEY AUDIT MATTERS (only LISTED)
O - OTHER MATTER
O - Other Information (positive - no inconsinstency in Annual Report)
RRR
R - Responsibilities of management (& TCWG)
R - Auditor’s responsibilities for the audit of F/S
R - OTHER REPORTING RESPONSIBILITIES (only LISTED)
Name of Engagement Partner (only LISTED)
SAD
S - Signature of the auditor
A - Address of the audit firm
D - Date of the auditor’s report
ISA 700
Qualified opinion - Basis for Qualified opinion
Adverse opinion - Basis for Adverse opinion
Disclaimer of opinion - Basis for Disclaimer of opinion
ISA 700
Audit Report
INDEPENDENT AUDITOR’S REPORT
To the shareholders of ABC Co:
AUDITOR’S OPINION
‘WE HAVE AUDITED the financial statements of ABC Co, which comprise the Statement Of Financial Position as at 31 December 20X5, Statement Of Comprehensive Income, Statement Of Changes In Equity & Statement Of Cash Flows for the year then ended, & Notes to the financial statements, including a Summary of significant accounting policies (CAP).
In our opinion, the accompanying financial statements give a** true and fair view** of the financial position of the Company as at 31 December 20X5, and (of) its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards.
BASIS FOR OPINION
(Part 1 - technical aspects)
WE CONDUCTED our audit in accordance with International Standards on Auditing (ISAs).
Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report.
WE BELIEVE that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
(Part 2 - related to Ethical Code)
WE ARE independent of the Company in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA code) together with the ethical requirements that are relevant to our audit of the financial statements in ____ [jurisdiction] , and WE HAVE fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA code.
(Other ethical responsibilities > Confidentiality, Confilct of Interest)
ISA 700
RESPONSIBILITIES OF MANAGEMENT (& TCWG) FOR THE F/S
MANAGEMENT IS RESPONSIBLE FOR the preparation & fair presentation of the F/S in accordance with IFRSs, & for such IC as management determines is necessary to enable the preparation of F/S that are free from material misstatement, whether due to fraud or error.
In preparing the F/S, MANAGEMENT IS RESPONSIBLE FOR assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
TCWG ARE RESPONSIBLE FOR overseeing the Company’s financial reporting process.
AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE F/S
Our objectives are to obtain REASONABLE ASSURANCE about whether the F/S as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
REASONABLE ASSURANCE is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these F/S.
OTHER REPORTING RESPONSIBILITIES (Report on Other Legal and Regulatory Requirements) UK Listing Rules require the auditors to review whether the Corporate Governance Statement reflects the company’s compliance with the provisions of the UK Corporate Governance Code and to report if it does not. Auditors are not required to consider whether the Board’s statements on internal control cover all risks and controls, or form an opinion on the effectiveness of the Group’s corporate governance procedures or its risk and control procedures
SIGNATURE
Unlisted company
(Signature can be either the personal name of the auditor or, the signature is on behalf of the firm, depending on the jurisdiction)
Listed company
(Signature must be BOTH the personal name of the auditor AND firm)
ADDRESS OF THE AUDIT FIRM SIGNING THE AUDIT REPORT.
(The location where the auditor practices)
DATE OF THE AUDITOR’S REPORT
(The auditor’s report shall be dated no earlier than the date on which the auditor has obtained sufficient appropriate audit evidence on which to base the auditor’s opinion on the financial statements)
