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Audit Report
Kunal Mandhania
❏ Audit & Law
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Auditing &
Assurance
SA-700
Types of opinion
Unmodified Modified
Clean Report
SA - 705
SA – 700 – Forming opinion on F.S
10.Date – Can be any date but after date of approval of F.s by mgt
11.Place – City where Audit report is signed
12.Signature
a) Prop firm – Signed in his own name
b) Part Firm/LLp- Sign on behalf of firm
c) Also mention membership no and Firm’s registration no
The auditor’s report shall include a section with a heading “Responsibilities of Management
for the Financial Statements.” SA 200 explains the premise, relating to the responsibilities of
management and, where appropriate, those charged with govenance, on which an audit in
accordance with SAs in conducted. Explain
[RTP-Nov. 18, MTP-April 19, may 20, April 21]
Matters 1) Higher
1) Listed Co. RMM 1) Communicate in
1) Should be auditors report
2) If required from 2) Significant under KAM para
In auditors by law matters risk with
judgement communica identified a) Separate heading
3) Optional tion to 3) Area b) Reason of
a) If entity TCWG requiring consideration
Were of is of + significant
most c) How matter was
significanc significa 2) Require mgt. addressed.
e in audit nt public significant judgement.
interest. 2) Where KAM not
auditor 4) Recent required
E.g. attention significant
Of F.S. of Banks, + event
a) Matter on which
F.I. report modified
current 3) Most occurred b) If disclaimer- then
period b) Public significant during omit KAM para
sector period (SA 705)
entites
Other important points
1. If matter highlighted in KAM no need to include it in EOM / OM para
2. Purpose [RTP-Nov. 18]
i) Enhance communication value of report for intended users
ii) Greater transparency
iii) Assist them in understanding significant areas , and matters requiring
significant judgement
1. Difference between KAM & EOM para
i) Significant – EOM para
Most significant – KAM Para
ii) KAM Para mandatory even if there is no KAM but EOM Para is included in
Auditor’s Report only when there is any matter to emphasize
4. Communicating KAM is not a Substitute to
i. Disclosure in FS
ii. Modified Opinion
iii. Material uncertainty about Going Concern Reporting
iv. Separate opinion individually
SA 710 – Comparative Information
corresponding figures & Comparative F.S
Prior period M.M still exists Prior period 1. Previous opinion differs
AR was where F.S not audited from current opinion
modified previously
unmodified
Disclose reason in ‘OM’ para
Matter of opinion was Mention O.M
modification issued para 2. Prior period F.S audited by
unresolved Predecessor auditor
+
Follow
Modifed report procedures of State in OM para
+ SA 510
Give ref to both
periods
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