Document ID: chunk:federal_register_of_legislation:F2023C01124:reg:17:p6
Version: federal_register_of_legislation:F2023C01124
Segment Type: reg
Provision Reference: reg 17 (pt 6/41)
Character Range: 26342–29516

A13‑A14)

         (b)                Management's process for identifying and responding to the risks of fraud in the entity, including any specific risks of fraud that management has identified or that have been brought to its attention, or classes of transactions, account balances, or disclosures for which a risk of fraud is likely to exist;  (Ref: Para. A15)

         (c)                Management's communication, if any, to those charged with governance regarding its processes for identifying and responding to the risks of fraud in the entity; and

         (d)                Management's communication, if any, to employees regarding its views on business practices and ethical behaviour.

19.               The auditor shall make enquiries of management, and others within the entity as appropriate, to determine whether they have knowledge of any actual, suspected or alleged fraud affecting the entity.  (Ref: Para. A16‑A18)

20.               For those entities that have an internal audit function, the auditor shall make enquiries of appropriate individuals within the function to determine whether they have knowledge of any actual, suspected or alleged fraud affecting the entity, and to obtain its views about the risks of fraud.  (Ref: Para. A19)

Those Charged with Governance

21.               Unless all of those charged with governance are involved in managing the entity,[7] the auditor shall obtain an understanding of how those charged with governance exercise oversight of management's processes for identifying and responding to the risks of fraud in the entity and the controls that management has established to mitigate these risks.  (Ref: Para. A20‑A22)

22.               Unless all of those charged with governance are involved in managing the entity, the auditor shall make enquiries of those charged with governance to determine whether they have knowledge of any actual, suspected or alleged fraud affecting the entity.  These enquiries are made in part to corroborate the responses to the enquiries of management.

Unusual or Unexpected Relationships Identified

23.               The auditor shall evaluate whether unusual or unexpected relationships that have been identified in performing analytical procedures, including those related to revenue accounts, may indicate risks of material misstatement due to fraud.

Other Information

24.               The auditor shall consider whether other information obtained by the auditor indicates risks of material misstatement due to fraud.  (Ref: Para. A23)

Evaluation of Fraud Risk Factors

25.               The auditor shall evaluate whether the information obtained from the other risk assessment procedures and related activities performed indicates that one or more fraud risk factors are present.  While fraud risk factors may not necessarily indicate the existence of fraud, they have often been present in circumstances where frauds have occurred and therefore may indicate risks of material misstatement due to fraud.  (Ref: Para. A24‑A28)

Identification and Assessment of the Risks of Material Misstatement Due to Fraud

26.               In accordance with ASA 315, the