Document ID: chunk:federal_register_of_legislation:F2023C01140:reg:39:p22
Version: federal_register_of_legislation:F2023C01140
Segment Type: reg
Provision Reference: reg 39 (pt 22/53)
Character Range: 71579–74681

is commonly understood and that appropriately summarises those sources (e.g., independence requirements for audits of private entities in Jurisdiction X).

A36.         Law or regulation, Australian Auditing Standards or the terms of an audit engagement may require the auditor to provide in the auditor's report more specific information about the sources of the relevant ethical requirements, including those related to independence, that applied to the audit of the financial report.

A37.         In determining the appropriate amount of information to include in the auditor's report when there are multiple sources of relevant ethical requirements relating to the audit of the financial report, an important consideration is balancing transparency against the risk of obscuring other useful information in the auditor's report.

Considerations specific to group audits

A38.         In group audits for which there are multiple sources of relevant ethical requirements, including those pertaining to independence, the reference in the auditor's report to the jurisdiction ordinarily relates to the relevant ethical requirements that are applicable to the group auditor.  This is because, in a group audit, component auditors are also subject to ethical requirements that are relevant to the group audit.[29]

A39.         The Australian Auditing Standards do not establish specific independence or ethical requirements for auditors, including component auditors, and thus do not extend, or otherwise override, the independence requirements of the relevant ethical requirements or other ethical requirements to which the group auditor is subject, nor do the Australian Auditing Standards require that the component auditor in all cases to be subject to the same specific independence requirements that are applicable to the group auditor.  As a result, relevant ethical requirements, including those pertaining to independence, in a group audit situation may be complex.  ASA 600[30] provides guidance for auditors in performing work on the financial information of a component for a group audit, including those situations where the component auditor does not meet the independence requirements that are relevant to the group audit.

Key Audit Matters (Ref: Para. 30‑31)

A40.         Law or regulation may require communication of key audit matters for audits of entities other than listed entities, for example, entities characterised in such law or regulation as public interest entities.

A41.         The auditor may also decide to communicate key audit matters for other entities, including those that may be of significant public interest, for example because they have a large number and wide range of stakeholders and considering the nature and size of the business.  Examples of such entities may include financial institutions (such as banks, insurance companies, and superannuation funds), and other entities such as charities.

A42.         ASA 210 requires the auditor to agree the terms of the audit engagement with management and those charged with governance, as appropriate, and