Amounts owed to lenders incl terms and any covenants May be more reliable

Amounts owed to lenders incl terms and any covenants

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• Amounts owed to lenders, incl. terms and any covenants. May be more reliable evidence as Obtained from independent source outside the entity. Obtained directly by the auditor. In documentary form (whether paper, electronic or other medium). Types Procedures (para. 7) Assessing the results Audit & Assurance Chartered Accountants Program Page 1 of 1 Quick reference guide 12.1 – External Confirmations – ISA 505
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Quick Reference Guide 12.2 Written representations – ISA 580 As Audit Evidence Written representations provide: • ‘necessary audit evidence’ BUT • ‘do not provide sufficient appropriate audit evidence on their own’. Consider in combination with other evidence obtained. Date and Period ‘as near as practicable to, but not after, the date of the auditor’s report on the financial statements’. It should cover all the financial statements and period(s) that are referred to in the auditor’s report. Contents Management to confirm at a minimum: it has fulfilled its responsibilities for the preparation of the financial statements It has provided all relevant information and access as agreed in the terms of the audit engagement • All transactions have been recorded in the financial statements • the verbal representations made by management over the course of the audit (as appropriate). Also include • Representations that are specifically required under various ISAs / laws / regulations. A written representation is a ‘written statement by management provided to the auditor to confirm certain matters or to support other audit evidence’ ( para. 7). Audit & Assurance Chartered Accountants Program Page 1 of 1 Quick reference guide 12.2 – Written representations – ISA 580
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Quick Reference Guide 12.3 Group audits ISA 600 – Responsibilities of a group auditor Responsibility, overall audit strategy and audit plan The group management team establishes group audit strategy and develops a group audit plan Understand the Group, its components and their environments (paras 17 and 18) This includes understanding of group-wide controls and consolidation process. The group auditor assesses RMM of the group financial statements and determines which components are significant Materiality (paras 21–23) Group materiality determined by group engagement team Component materiality determined by group engagement team (Lower than materiality for the group as a whole) Communication with the component auditor (paras 40 & 41) Advise component auditors of requirements, deadlines etc. Component auditor to communicate matters relevant to the group engagement team’s conclusion re the group audit Evaluate the sufficiency and appropriateness of audit evidence obtained (paras 42–45) Review component auditor’s work and determine if they (or group auditor) need to perform additional procedures Evaluate the effect on the group audit opinion of any uncorrected misstatements Communication with group management and those charged with governance of the group (paras 46–49) Consider which identified deficiencies in internal controls to communicate Fraud identified or if information suggests it may exist
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