ACCA AA · Chapter 12 · Question 3 of 9
After the auditor's report has been dated but before the financial statements are issued, the auditor becomes aware of a fact that would have caused the report to be amended. What should the auditor do first under ISA 560?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: D) Discuss the matter with management and, where appropriate, those charged with governance, and determine whether the financial statements need amendment
Explanation
Although there is no duty to search for events after the report date, a fact that becomes known must be addressed. The auditor discusses it with management, determines whether amendment is needed and, if so, how management intends to deal with it. If amended, the auditor performs procedures on the amendment and issues a new report.
More Subsequent events, going concern and written representations MCQs
- Q5Under ISA 570, if management's assessment of going concern covers less than a particular period, the auditor should ask management to…
- Q6At the year end, Fettle Co has current assets of $2.1 million and current liabilities of $3.0 million. Its overdraft facility is due for…
- Q7Under ISA 580, how should written representations be dated?
- Q8Management refuses to provide a written representation confirming that it has fulfilled its responsibility for preparing the financial…
- Q9Which of the following statements about written representations is correct?