Document ID: chunk:federal_register_of_legislation:F2023C00341:reg:4:p13
Version: federal_register_of_legislation:F2023C00341
Segment Type: reg
Provision Reference: reg 4 (pt 13/42)
Character Range: 44883–48062

professional confidentiality considerations, shall consider whether to advise the component auditor not to issue the auditor's report on the financial report of the component until the matter is resolved.  (Ref: Para. A65)

Communication with Those Charged with Governance of the Group

49.               The group engagement team shall communicate the following matters with those charged with governance of the group, in addition to those required by ASA 260[13] and other Auditing Standards:  (Ref: Para. A66)

(a)                An overview of the type of work to be performed on the financial information of the components.

(b)                An overview of the nature of the group engagement team's planned involvement in the work to be performed by the component auditors on the financial information of significant components.

(c)                Instances where the group engagement team's evaluation of the work of a component auditor gave rise to a concern about the quality of that auditor's work.

(d)                Any limitations on the group audit, for example, where the group engagement team's access to information may have been restricted.

(e)                Fraud or suspected fraud involving group management, component management, employees who have significant roles in group‑wide controls or others where the fraud resulted in a material misstatement of the group financial report.

Documentation

50.               The group engagement team shall include in the audit documentation the following matters:[14]

(a)                An analysis of components, indicating those that are significant, and the type of work performed on the financial information of the components.

(b)                The nature, timing and extent of the group engagement team's involvement in the work performed by the component auditors on significant components including, where applicable, the group engagement team's review of relevant parts of the component auditors' audit documentation and conclusions thereon.

(c)                Written communications between the group engagement team and the component auditors about the group engagement team's requirements.

* * *

Application and Other Explanatory Material

Components Subject to Audit by Statute, Regulation or Other Reason (Ref: Para. 3)

A1.             Factors that may affect the group engagement team's decision whether to use an audit required by statute, regulation or for another reason to provide audit evidence for the group audit include the following:

           * Differences in the financial reporting framework applied in preparing the financial report of the component and that applied in preparing the group financial report.

           * Differences in the auditing and other standards applied by the component auditor and those applied in the audit of the group financial report.

           * Whether the audit of the financial report of the component will be completed in time to meet the group reporting timetable.

Definitions

Component (Ref: Para. 9(a))

A2.             The structure of a group affects how components are identified.  For example, the group financial reporting