ICAI Guidance Note on Subsequent Events-Key Audit Considerations amid COVID-19

ICAI releases Guidance Note on “Subsequent Events –Key Audit Considerations amid COVID-19” 

ICAI has released an Auditing Guidance on “Subsequent Events –Key Audit Considerations amid COVID-19” for the benefit of the members.

The guidance note highlights the key areas where focus is desired due to Covid-19 pandemic on events occurring between the date of the financial statements and the date of the auditor’s report (i.e., subsequent events) and the effect, if any, of such on the entity’s financial statements.

It has been clarified that the guidance note does not amend or override the Standards on Auditing (SAs) 560 which sets out the auditor’s responsibilities with respect to subsequent events.

The guidance note list out the auditor’s responsibilities in relation to obtaining sufficient appropriate audit evidence about subsequent events impacted by the COVID-19 pandemic. It also gives examples of events or conditions that may be affected by, or exist as a result of, the COVID-19 pandemic.

Where a fact become known to the auditor after the date of audit report is such that had it been known to the auditor at the date of the report, auditor might have amended the report, then a a modification to the auditor’s opinion is required as per SA 705.

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