Revised Code of Ethics in the Phils - 2010

The modifications are notpermitted in the case of an

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Unformatted text preview: ablelevel. Examples of such safeguards include: • If the litigation involves a member of the audit team, removing thatindividual from the audit team; or • Having a professional review the work performed. If such safeguards do not reduce the threats to an acceptable level, the onlyappropriate action is to withdraw from, or decline, the audit engagement. Paragraphs 290.232 to 290.499 are intentionally left blank. SECTION 290 Reports that Include a Restriction on Use and Distribution Introduction 290.500 The independence requirements in Section 290 apply to all auditengagements. However, in certain circumstances involving auditengagements where the report includes a restriction on use and distribution,and provided the conditions described in paragraphs 290.501 to 290.502 aremet, the independence requirements in this section may be modified asprovided in paragraphs 290.505 to 290.514. These paragraphs are onlyapplicable to an audit engagement on special purpose financial statements(a) that is intended to provide a conclusion in positive or negative form thatthe financial statements are prepared in all material respects, in accordancewith the applicable financial reporting framework, including, in the case ofa fair presentation framework, that the financial statements give a true andfair view or are presented fairly, in all material respects, in accordance withthe applicable financial reporting framework, and (b) where the audit reportincludes a restriction on use and distribution. The modifications are notpermitted in the case of an audit of financial statements required by law orregulation. 290.501 The modifications to the requirements of Section 290 are permitted if theintended users of the report (a) are knowledgeable as to the purpose andlimitations of the report, and (b) explicitly agree to the application of themodified independence requirements. Knowledge as to the 84 purpose andlimitations of the report may be obtained by the intended users through theirparticipation, either directly or indirectly through their representative whohas the authority to act for the intended users,...
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