Page 130 - CA Final Audit Titanium Full Book. (With Cover Pages)

CA Ravi Taori

4. SAAE: The report should state whether the auditor believes that the audit evidence obtained is sufficient and
appropriate to provide a basis for the auditor’s opinion.

(CNO - SA 700.180) Going Concern: (If required for material uncertainty)
1. SA 570 Compliance: Where applicable, the auditor should report in accordance with SA 570, which outlines
the auditor's responsibilities relating to the going concern in the audit of financial statements.
1A. Material Uncertainty: The auditor should conclude, based on the audit evidence obtained, whether a
material uncertainty exists about the entity’s ability to continue as a going concern.
1B. Auditors Responsibility: The auditor is responsible for obtaining sufficient appropriate audit evidence and
concluding on the appropriateness of management’s use of the going concern basis of accounting in the
preparation of the financial statements.
Implications for the Auditor’s Report:
Refer Ch 06 (CNO-SA570.060) Step 3: - Conclusion & Reporting

(CNO - SA 700.200) Key Audit Matters: (To be covered in SA 701)
Definition: Key Audit Matters are those matters that, in the auditor’s professional judgment, were of most
significance in the audit of the financial statements of the current period.
Selection: Key audit matters are selected from matters communicated with those charged with governance.
General Purpose Financial Statements: For audits of complete sets of general-purpose financial statements of
listed entities, the auditor should communicate key audit matters in the auditor’s report in accordance with SA
701.
Legal Requirement: When the auditor is required by law or regulation or
Decision to communicate decides to communicate key audit matters in the auditor’s report, they should do so
in accordance with SA 701.

(CNO - SA 700.220) Responsibilities for the Financial Statements:
1A. Heading: The auditor’s report should include a section with a heading “Responsibilities of Management for
the Financial Statements.”
1B. Appropriate Term: The auditor’s report should use the term that is appropriate in the context of the legal
framework applicable to the entity. It need not refer specifically to “management”. In some entities, the
appropriate reference may be to those charged with governance.
2A. Preparation and Internal Control: Management is responsible for preparing the financial statements in
accordance with the applicable financial reporting framework. They are also responsible for such internal control
as they determine is necessary to enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
2B. Going Concern Assessment: Management is responsible for assessing the entity’s ability to continue as a
going concern and whether the use of the going concern basis of accounting is appropriate. They should also
disclose, if applicable, matters relating to going concern. The explanation of management’s responsibility for this
assessment should include a description of when the use of the going concern basis of accounting is appropriate.
2C. Identification of Oversight Responsibilities.
Oversight Identification: The report should identify those responsible for the oversight of the financial
reporting process.
Governance Reference: If the individuals responsible for oversight are different from those fulfilling the
responsibilities described in the following paragraph, the heading of this section should also refer to “Those
Charged with Governance” or a similar term that is appropriate in the context of the legal framework applicable
to the entity.

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