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Seminar 2 Part 2 - Coggle Diagram

- - - - The major examples would be where there is a disclosure in the notes to the financial report that the auditor considers to be complete and adequate, but important enough to bring to users’ attention.
    - - uncertainty relating to the future outcome of exceptional litigation or regulatory action
      - early application (where permitted) of a new accounting standard that has a material effect on the financial report
      - a major catastrophe that has had, or continues to have, a significant effect on the entity’s financial position.
    - - For example, an Emphasis of Matter paragraph may be presented either directly before or after the key audit matters section, based on the relative significance of the information included in the Emphasis of Matter paragraph
        
        An Emphasis of Matter is not a modification of the auditor’s opinion, and care needs to be taken to make this clear to the user of the auditor’s report when describing the matter. It can be introduced using words such as ‘Without modification to the opinion expressed above, attention is drawn to …’ or, when the auditor’s opinion has been modified, ‘Without further modification to the opinion expressed above, attention is drawn to …’.
  - - - where it is not possible to withdraw from the audit even though a limitation imposed by management on the scope of the audit is pervasive (a matter relevant to the users’ understanding of the audit)
      - where national regulations require the auditor to further elaborate on their responsibilities in the audit (a matter relevant to users’ understanding of the auditor’s responsibilities)
      - where the auditor’s report covers more than one financial report, each prepared in accordance with general-purpose financial reporting frameworks, such as a national framework and International Financial Reporting Standards (a matter relevant to users’ understanding of the auditor’s report)
    - - if revision of the other information is necessary and management refuses to make this revision, the auditor should, in addition to meeting other requirements, include in the auditor’s report an Other Matter paragraph describing the material inconsistency.
        
        An Other Matter paragraph should be headed ‘Other Matter’. Its placement in the auditor’s report will depend on the nature and significance of the communication.
        
        For example, when relevant to users’ understanding of the auditor’s report, the Other Matter paragraph may be included as a separate section following the report on other legal and regulatory requirements, or elsewhere in the auditor’s report if the content of the Other Matter paragraph is relevant to the ‘Other reporting requirements’ section