Page 223 - CA Final PARAM Digital Book.

3. Case Discussion: Discuss Case.
4. Conclusion: Draft Paragraph

Basis of Accounting and Restriction on Distribution and Use Without modifying our opinion, we draw
attention to Note A to the financial statements, which describes the basis of accounting. The financial
statements are prepared to assist the company to comply with the financial reporting provisions of the
contract referred to above. As a result, the financial statements may not be suitable for another purpose.
Our report is intended solely for X Ltd. and Y Ltd. and should not be distributed to or used by parties other
than X Ltd. And Y Ltd.

QNO Signing multiple Reports New Course – (SM23)
800.300 TITANIUM CNO-- Unique
CA Lalita is auditor of a company. She is also offered professional work of audit of financial statements
prepared specifically for meeting requirements of a loan agreement for the same period. She chooses to
accept work and has made up her mind to disclose this fact in “Othe r matter Paragraph” in audit report
to be issued by her for this specific engagement. Is her approach proper?
Answer 1. SA 800 & SA 706: Reference to SA 800 & SA 706, its full name & its applicable in the given scenario.
2. Concept: SA 800 - There is no restriction on auditor’s other than Auditors of General purpose FST
framework to accept audit of special purpose FST.
SA 706 - Reporting on more than one set of financial - statements An entity may prepare one set
of financial statements in accordance with a general purpose framework (e.g., the national
framework) and another set of financial statements in accordance with another general purpose
framework (e.g., International Financial Reporting Standards), and engage the auditor to report on
both sets of financial statements. If the auditor has determined that the frameworks are acceptable
in the respective circumstances, the auditor may include an Other Matter paragraph in the
auditor’s report, referring to the fact that another set of financial statements has been prepared
by the same entity in accordance with another general-purpose framework and that the auditor
has issued a report on those financial statements.
3. Case Discussion: Discuss Case.
4. Conclusion: She can accept such audit & disclose in other Matter Paragraph.

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