Document ID: chunk:federal_register_of_legislation:F2025L00107:front:0:p33
Version: federal_register_of_legislation:F2025L00107
Segment Type: other
Provision Reference: 
Character Range: 108876–112751

testing the operating effectiveness of controls, the practitioner shall obtain an understanding of: (Ref: Para. A387–A392, A399L)                                                                                             120R. The practitioner shall obtain an understanding of each control identified in accordance with paragraph 119R(a), (c), and (d) by: (Ref: Para. A393–A398)

       1.       The controls the practitioner plans to test, including if applicable, any complementary user entity controls identified in the assurance report of another practitioner that are determined to be relevant to the user entity in accordance with paragraph 52; and         1.       Evaluating whether the control is designed effectively to address the risk of material misstatement at the assertion level, or effectively designed to support the operation of other controls; and

       1.       The entity's general IT controls that address risks arising from the use of IT related to the controls identified in (a).                                                                                                                                                  1.       Determining whether the control has been implemented by performing procedures in addition to enquiry of the entity's personnel.

      by: (Ref: Para. A393–A398)

       1.       Evaluating whether the control is designed effectively to address the risk of material misstatement for the disclosure, or effectively designed to support the operation of other controls; and

       1.       Determining whether the control has been implemented by performing procedures in addition to enquiry of the entity's personnel.

Identifying Control Deficiencies

 1.            Based on the practitioner's understanding of the components of the entity's system of internal control, the practitioner shall consider whether one or more control deficiencies have been identified. (Ref: Para. A400–A403)

Identifying and Assessing the Risks of Material Misstatement

Limited Assurance                                                                                                                                                                                                                         Reasonable Assurance
    122L.  The practitioner shall identify and assess the risks of material misstatement at the disclosure level as a basis for designing and performing procedures whose nature, timing and extent: (Ref: Para. A404–A414, A416L, A417)      122R. The practitioner shall identify and assess the risks of material misstatement at the assertion level for the disclosures as a basis for designing and performing procedures whose nature, timing and extent: (Ref: Para. A404–A405, A407–A408, A410–A415R, A417–A418R)

       1.       Are responsive to the assessed risks of material misstatement; and                                                                                                                                                               1.       Are responsive to the assessed risks of material misstatement; and

       2.       Allow the practitioner to obtain limited assurance about whether the sustainability information is prepared, in all material respects, in accordance with the applicable criteria.                                               2.       Allow the practitioner to obtain reasonable assurance about whether the sustainability information is prepared, in all material respects, in accordance with the applicable criteria.

123R.  Due to the unpredictable way in which management is able to override controls, the practitioner shall treat risks of management override of controls as risks of material misstatement due to fraud and thus risks of material misstatement at the upper end of the spectrum of risk. (Ref: Para. A418R)

Evaluating the Evidence Obtained from the