Page 177 - CA Final Audit Titanium Full Book. (With Cover Pages)

CA Ravi Taori
becomes aware that the other information needs to be revised, the auditor shall discuss the matter with
management.

(CNO SA- 810.140) Auditor Association
Situation 1
Does not plan to include auditor’s report: If the auditor becomes aware that the entity plans to state that the
auditor has reported on summary financial statements in a document containing the summary financial
statements but does not plan to include the related auditor’s report, the auditor shall request management to
include the auditor’s report in the document.
Management's Inaction: If management does not do so, the auditor shall determine and carry out other
appropriate actions designed to prevent management from inappropriately associating the auditor with the
summary financial statements in that document.
Situation 2
Not Engaged for SFS: The auditor may be engaged to report on the financial statements of an entity, while not
engaged to report on the summary financial statements (SFS).
Reference to Auditor: If, in this case, the auditor becomes aware that the entity plans to make a statement in a
document that refers to the auditor and the fact that summary financial statements are derived from the financial
statements audited by the auditor, the auditor shall be satisfied that:
(a) The reference to the auditor is made in the context of the auditor’s report on the audited financial statements;
and
(b) The statement does not give the impression that the auditor has reported on the summary financial
statements.
If (a) or (b) are not met, the auditor shall request management to change the statement to meet them, or not to
refer to the auditor in the document.
Alternatively Engage Auditor: Alternatively, the entity may engage the auditor to report on the summary
financial statements and include the related auditor’s report in the document.
Management's Refusal: If management does not change the statement, delete the reference to the auditor, or
include an auditor’s report on the summary financial statements in the document containing the summary
financial statements.
The auditor shall advise management that the auditor disagrees with the reference to the auditor, and the auditor
shall determine and carry out other appropriate actions designed to prevent management from inappropriately
referring to the auditor.

(CNO SA- 810.160) Timing of Work and Events Subsequent to the Date of the Auditor’s Report on the
Audited Financial Statements
Reporting After Audit Completion: When the auditor reports on the summary financial statements after the
completion of the audit of the financial statements.
No Additional Audit Evidence Required: The auditor is not required to obtain additional audit evidence on
the audited financial statements.
No Reporting on Subsequent Events: Or report on the effects of events that occurred subsequent to the date
of the auditor’s report on the audited financial statements since the summary financial statements are derived
from the audited financial statements.

www.auditguru.in 8.14