ICAI Revised Standard on Auditing SA-720. Auditor’s Responsibilities Relating to Other Information for financial statements

Revised Standard on Auditing SA-720. The Auditor’s Responsibilities Relating to Other Information

ICAI has issued revised Standard on Auditing SA-720. The Standard on Auditing (SA) deals with the auditor’s responsibilities relating to other information, whether financial or non-financial information (other than financial statements and the auditor’s report thereon), included in an entity’s annual report.

The revised SA-720 is effective for audits of financial statements for periods beginning on or after April 1, 2018.

The auditor’s responsibilities relating to other information (other than applicable reporting responsibilities) apply regardless of whether the other information is obtained by the auditor prior to, or after, the date of the auditor’s report.

The SA-720 ensures that there is no material inconsistency between the other information and the financial statements/knowledge obtained in the audit. The auditor is obliged to respond and report when material inconsistencies appear to exist, or when the auditor otherwise becomes aware that other information appears to be materially misstated.

The SA-720 do not cover the auditor’s opinion on the financial statements, nor does this SA require the auditor to obtain audit evidence beyond that required to form an opinion on the financial statements. However, other laws or regulations may impose additional obligations on the auditor in relation to other information that are beyond the scope of SA-720.

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