Document ID: chunk:federal_register_of_legislation:F2019L00016:reg:20:p5
Version: federal_register_of_legislation:F2019L00016
Segment Type: reg
Provision Reference: reg 20 (pt 5/9)
Character Range: 22446–25790

its ability to do so.

                   + Risks of material misstatement.

                   + Indicators of possible management bias.

                   + How management has considered alternative assumptions or outcomes and why it has rejected them, or how management has otherwise addressed estimation uncertainty in making the accounting estimate.

                   + The adequacy of disclosure of estimation uncertainty in the financial report.

24.               Existing footnote 29 to Appendix 2 is deleted.

Amendments to ASA 500

25.               The following sub‑paragraph 5(d) (including footnotes, 6 and 7) is inserted following existing
sub‑paragraph 5(c):

External information source means an external individual or organisation that provides information that has been used by the entity in preparing the financial report, or that has been obtained by the auditor as audit evidence, when such information is suitable for use by a broad range of users. When information has been provided by an individual or organisation acting in the capacity of a management's expert, service organisation6, or auditor's expert7 the individual or organisation is not considered an external information source with respect to that particular information. (Ref: Para. A1‑A4)

         6    See ASA 402 Audit Considerations Relating to an Entity Using a Service Organisation, paragraph 8.
         7    See ASA 620 Using the Work of an Auditor's Expert, paragraph 6.

26.               As a result of the insertion of sub paragraph 5(d), subsequent subparagraphs of the paragraph 5 are re‑numbered and references to these paragraphs are updated accordingly.

27.               As a result of the insertion of footnotes 6 and 7, subsequent footnotes of this Auditing Standard are re‑numbered and references to these footnotes are updated accordingly.

28.               Existing paragraph 7 is amended to read as follows:

When designing and performing audit procedures, the auditor shall consider the relevance and reliability of the information to be used as audit evidence., including information obtained from an external information source. (Ref: Para. A26‑A44)

29.               Following the heading Application and Other Explanatory Material, and before the
sub‑heading Sufficient Appropriate Audit Evidence the following sub‑heading is inserted:

External Information Source (Ref: Para. 5(d))

30.               Following the sub‑heading inserted above, the following paragraph A1 is inserted:

External information sources may include pricing services, governmental organisations, central banks or recognised stock exchanges. Examples of information that may be obtained from external information sources include:

           * Prices and pricing related data;

           * Macro‑economic data, such as historical and forecast unemployment rates and economic growth rates, or census data;

           * Credit history data;

           * Industry specific data, such as an index of reclamation costs for certain extractive industries, or viewership information or ratings used to determine advertising revenue in the entertainment industry; and

           * Mortality tables used to determine liabilities in the life insurance and superannuation sectors.

31.               Following the paragraph inserted above, the following