CA Inter P5 · Chapter 7 · Question 3 of 12
After the date of the auditor's report but before the financial statements are issued, the auditor of Ira Cosmetics Ltd. becomes aware of a fact that might have caused the report to be amended. Under SA 560, the auditor shall:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Discuss the matter with management and, where appropriate, those charged with governance, determine whether the financial statements need amendment, and inquire how management intends to address it
Explanation
SA 560 states that the auditor has no obligation to perform procedures after the report date, but if a fact becomes known that might have caused amendment, the auditor shall discuss it with management and TCWG, determine whether the financial statements need amendment and, if so, inquire how management intends to address the matter in the financial statements.
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