ISA 560 Flowchart [PDF]

Zitiervorschau

Date when FS are authorized for issue as per IAS 10

ISA 560 Subsequent Events (Jamshaid Akhtar ACA)

30th June

8th July

30th Sept.

4th Oct.

4th Oct.

Year End

Start of Audit

Final Draft with Initialed Report

BOD Meeting for Approval of FS

Auditor's Report

subsequent events occurred between reporting period and date of audit report

8th Oct.

Notice of AGM (FS issue date)

On Page 2

-Auditor has no obligation to perform any audit procedures. -But had he known this fact at audit report date, he would have amended the report.

Procedures aimed specifically at identifying subsequent events (Active Review-Para 7)

-Events identified might require adjustments/disclosure -If not adjusted then impact on auditor's report

AGM

Facts discovered after the FS have been issued

Facts become known to auditor between the date of audit report and issue of FS

Auditor is required to obtain sufficient appropriate audit evidence of these subsequent events through;

Normal audit verification work

30th Oct.

-Discus with management -FS Need amendment? -How management will address matter in FS? FS are amended by management

If Para 12 does not apply: -Carry out necessary audit procedures on amendment. -Rewrite audit report and give new date (date would be later of approval of amended FS) -Extend review of subsequent event (Para 6, 7) up to new audit report date.

FS are not amended by management If Para 12 applies (restrict amendment of FS to only that subsequent event) i. Amend audit report to include additional date (dual dating) (Ex-1) OR ii. Provide new or amended report with Emphasis or Other Matter para (Ex-2) -Extend review of subsequent event only to that amendment

Audit report has not been provided to entity

Modify audit opinion

Audit report has been provided to entity

-Instruct management not to issue FS before amendment. -if they do so, prevent reliance on audit report after taking legal advice.

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ISA 560 Subsequent Events (Jamshaid Akhtar ACA)

Facts discovered after the FS have been issued

-Auditor has no obligation to perform any audit procedures. -But had he known this fact at audit report date, he would have amended the report.

-Discus with management -FS Need amendment? -How management will address matter in FS?

FS are amended by management

-Carry out necessary audit procedures on amendment. -Review steps to inform those who received original FS & audit report.

If Para 12 does not apply: -New audit report with Emphasis or Other Matter para and new date. (Ex3) -Extend review of subsequent event (Para 6, 7) up to new audit report date.

If Para 12 applies (restrict amendment of FS to only that subsequent event): i. Amend audit report to include additional date (dual dating) & EOM (Ex-4) OR ii. Provide new or amended report with Emphasis or Other Matter para (Ex-5) -Extend review of subsequent event only to that amendment

FS are not amended by management

-Review steps taken by management to prevent reliance on FS & audit report. -If management fails, auditor will take steps by himself to prevent reliance

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ISA 560 Subsequent Events

For Examples: March 31, 20X1 - Date of Auditor's Report April 15, 20X1 - Date of Subsequent Event

(Jamshaid Akhtar ACA) Ex-1

Ex-5

Ex-2

Ex-3

Ex-4

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