Page 125 - CA Final Audit Titanium Full Book. (With Cover Pages)

CA Ravi Taori
Types
There are two types of written representations: -
Written Representations about Management's Responsibilities (Compulsory)
Other Written Representations
Not a substitute of regular audit procedure
Non-Substitution: Written representations provide necessary audit evidence but are not sufficient on their
own. They cannot be a substitute for other evidence that the auditor expects to be reasonably available, and the
provision of reliable written representations does not affect the nature or extent of other audit evidence
required.
Example
Example: A representation by management regarding the quantity, existence, and cost of inventories is not a
substitute for normal audit procedures for verification and valuation. If the auditor cannot obtain sufficient
appropriate audit evidence on a material matter, even with a representation from management, it constitutes a
limitation on the scope of the examination.

(CNO-SA580.040) Written Representations About Management's Responsibilities
WR for Preparation of the Financial Statements
1A. Request: The auditor shall request management to provide a written representation about its
responsibility for preparing the financial statements according to the applicable framework.
Confirmation: Audit evidence alone is not sufficient; confirmation from management about fulfilling
responsibilities is required.
WR for Information Provided and Completeness of Transactions
1B. Information: The auditor shall request management to provide a written representation that all relevant
information and access have been provided as agreed in the terms of the audit engagement.
1C. Completeness: The auditor shall request a written representation that all transactions have been recorded
and are reflected in the financial statements.
Management Responsibility as per Terms of Engagement
2A. Description: Management's responsibilities shall be described in the written representations as they are in
the terms of the audit engagement.
2B. Reconfirmation: The auditor may ask management to reconfirm its understanding of those
responsibilities in written representations, particularly when: (Detailed)
• The terms were prepared in a previous year.
• Signatories of the audit engagement no longer have relevant responsibilities.
• There is any indication of misunderstanding by management.
• Changes in circumstances make reconfirmation appropriate.

(CNO-SA580.060) Date of And Period(S) Covered By Written Representations

1. Date Alignment: The date of the written representations should be close to, but not after, the date of the
auditor's report on the financial statements.
2A. Coverage: The written representations must cover all financial statements and periods mentioned in the
auditor's report.
2B. Management change: Even if management changes, they must provide written representations for the last
year, as the financial statements are their responsibility.

(CNO-SA580.080) Requested Written Representations Not Provided
Discussion: Discuss the matter with management.
Evaluation: Re-evaluate the integrity of management and evaluate the effect on the reliability of
representations and audit evidence.

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