Question

PART B

Select TWO   ISAs (AUDIT EVIDENCE ) and prepare a concise bullet point summary of the key points of each particular ISA     Bullet points cannot exceed 10 and cannot be less than 5 bullet points.     Cross referenced your bullet points to specific section reference

(20 pts each for each ISA                  total of 40 points for both)

            Example:     ISA 700 Revised

1. -Per Par 23- the first section of auditors report shall include the auditors and shall have the heading – OPIINION
2. -per Par 24- the opinion section of the auditors report shall also identify the entity whose financial statements have been audited
3. – per Par 24 - the opinion section of the auditor’s report shall also specify date of or period covered by, each financial statement comprising the financial statements
4. --Per par 28- the auditors report shall include a section directly following the Opinion Section with the heading BASIS FOR OPINION
5. - Per Par 28 – It shall also state that audit was conducted in accordance with International Standards on Auditing
6. THE ABOVE CAN BE SEEN ON BTL 2019 AUDITORS REPORT ON PAGE 37/74 and also any local company auditor’s report

Answer 1

International Standards on Auditing

ISA 500 Audit Evidence

1. ISA explains what constitutes audit evidence in an audit of financial statements, and deals with the auditor’s responsibility to design and perform audit procedures to obtain sufficient appropriate audit evidence to be able to draw reasonable conclusions on which to base the auditor’s opinion.
2. The objective of the auditor is to design and perform audit procedures in such a way as to enable the auditor to obtain sufficient appropriate audit evidence to be able to draw reasonable conclusions on which to base the auditor’s opinion.
3. The auditor shall design and perform audit procedures that are appropriate in the circumstances for the purpose of obtaining sufficient appropriate audit evidence.
4. When designing and performing audit procedures, the auditor shall consider the relevance and reliability of the information to be used as audit evidence
5. If information to be used as audit evidence has been prepared using the work of a management’s expert, the auditor shall, to the extent necessary, having regard to the significance of that expert’s work for the auditor’s purposes- Evaluate the competence, capabilities and objectivity of that expert;Obtain an understanding of the work of that expert;Evaluate the appropriateness of that expert’s work as audit evidence for the relevant assertion.
6. When using information produced by the entity, the auditor shall evaluate whether the information is sufficiently reliable for the auditor’s purposes, including, as necessary in the circumstances:Obtaining audit evidence about the accuracy and completeness of the information;Evaluating whether the information is sufficiently precise and detailed for the auditor’s purposes
7. When designing tests of controls and tests of details, the auditor shall determine means of selecting items for testing that are effective in meeting the purpose of the audit procedure.

ISA 700 Revised Forming an opinion and reporting on Financial Statements

1. This International Standard on Auditing (ISA) deals with the auditor’s responsibility to form an opinion on the financial statements. It also deals with the form and content of the auditor’s report issued as a result of an audit of financial statements
2. The objectives of the auditor are:To form an opinion on the financial statements based on an evaluation of the conclusions drawn from the audit evidence obtained; and To express clearly that opinion through a written report.
3. The auditor shall form an opinion on whether the financial statements are prepared, in all material respects, in accordance with the applicable financial reporting framework.
4. In order to form that opinion, the auditor shall conclude as to whether the auditor has obtained reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error.
5. The auditor shall evaluate whether the financial statements are prepared, in all material respects, in accordance with the requirements of the applicable financial reporting framework. This evaluation shall include consideration of the qualitative aspects of the entity’s accounting practices, including indicators of possible bias in management’s judgments.
6. The auditor shall evaluate whether the financial statements adequately refer to or describe the applicable financial reporting framework.
7. The auditor shall express an unmodified opinion when the auditor concludes that the financial statements are prepared, in all material respects, in accordance with the applicable financial reporting framework.
8. The auditor’s report shall be in writing. Auditor’s Report for Audits Conducted in Accordance with International Standards on Auditing