Document ID: chunk:federal_register_of_legislation:F2023C01136:reg:9:p16
Version: federal_register_of_legislation:F2023C01136
Segment Type: reg
Provision Reference: reg 9 (pt 16/24)
Character Range: 47918–50851

to other information included in the annual report .  Although the auditor's opinion on the financial report does not cover the other information[31] the auditor may consider this information, as well as other publicly available communications by the entity or other credible sources, in formulating the description of a key audit matter.

A39.         Audit documentation prepared during the audit can also be useful to the auditor in formulating the description of a key audit matter.  For example, written communications, or the auditor's documentation of oral communications, with those charged with governance and other audit documentation provides a useful basis for the auditor's communication in the auditor's report.  This is because audit documentation in accordance with ASA 230 is intended to address the significant matters arising during the audit, the conclusions reached thereon, and significant professional judgements made in reaching those conclusions, and serves as a record of the nature, timing and extent of the audit procedures performed, the results of those procedures, and the audit evidence obtained.  Such documentation may assist the auditor in developing a description of key audit matters that explains the significance of the matter and also in applying the requirement in paragraph 18.

Reference to Where the Matter Is Disclosed in the Financial Report (Ref: Para. 13)

A40.         Paragraphs 13(a)‑(b) requires the description of each key audit matter to address why the auditor considered the matter to be one of most significance in the audit and how the matter was addressed in the audit.  Accordingly, the description of key audit matters is not a mere reiteration of what is disclosed in the financial report.  However, a reference to any related disclosures enables intended users to further understand how management has addressed the matter in preparing the financial report.

A41.         In addition to referring to related disclosure(s), the auditor may draw attention to key aspects of them.  The extent of disclosure by management about specific aspects or factors in relation to how a particular matter is affecting the financial report of the current period may help the auditor in pinpointing particular aspects of how the matter was addressed in the audit such that intended users can understand why the matter is a key audit matter.  For example:

           * When an entity includes robust disclosure about accounting estimates, the auditor may draw attention to the disclosure of key assumptions, the disclosure of the range of possible outcomes, and other qualitative and quantitative disclosures relating to key sources of estimation uncertainty or critical accounting estimates, as part of addressing why the matter was one of most significance in the audit and how the matter was addressed in the audit.

           * When the auditor concludes in accordance with ASA 570