ICAI has issued Revised Standard on Auditing SA-299 on Joint Audit of Financial Statements
The practice of appointing more than one auditor to conduct the audit of large entities has been in vogue for a longtime which is sometimes voluntarily or sometimes due to the requirements of laws or regulations. The joint auditors conduct the audit jointly and report on the financial statements of the entity.
The Revised SA-299 lays down the principles for effective conduct of joint audit to achieve the overall objectives of the auditor as laid down in SA 200 “Overall Objectives of the Independent Auditor and the conduct of an audit in accordance with Standards on Auditing”.
The stated objectives of the Standard are laying down broad principles for the joint auditors in conducting the joint audit, providing a uniform approach to the joint audit process, to identify the distinct areas of work and coverage thereof by each joint auditor and to identify individual responsibility and joint responsibility of the joint auditors in relation to audit.
The Standard deals with the special considerations in carrying out audit by joint auditors. In addition to the requirements of the Standard, the joint auditors also required to comply with all the relevant requirements of other applicable Standards on Auditing.
A joint audit has been defined as an audit of financial statements of an entity by two or more auditors appointed with the objective of issuing the audit report. The Standard does not deal with the relationship between a principal auditor who is appointed to report on the financial statements of an entity and another auditor who is appointed to report on the financial statements of one or more component (divisions, branches, subsidiary, joint venture, associates, other entity) included in the financial statements of the entity.
The SA-299 is effective for audits of financial statements for periods beginning on or after April 1, 2018.
Also, the Standard should be read in the context of the “Preface to the Standards on Quality Control, Auditing, Review, Other Assurance and Related Services,” which sets out the authority of SAs and SA 200, “Overall Objectives of the Independent Auditor and the Conduct of an Audit in Accordance with Standards on Auditing”.
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