Document ID: chunk:federal_register_of_legislation:F2023C01128:reg:17:p10
Version: federal_register_of_legislation:F2023C01128
Segment Type: reg
Provision Reference: reg 17 (pt 10/25)
Character Range: 33616–36730

opinion on the financial report.  The matters that Australian Auditing Standards require to be communicated, therefore, include significant matters arising during the audit of the financial report that are relevant to those charged with governance in overseeing the financial reporting process.

           * The fact that Australian Auditing Standards do not require the auditor to design procedures for the purpose of identifying supplementary matters to communicate with those charged with governance.

           * When ASA 701[8] applies, the auditor's responsibilities to determine and communicate key audit matters in the auditor's report.

           * When applicable, the auditor's responsibility for communicating particular matters required by law or regulation, by agreement with the entity or by additional requirements applicable to the engagement.

A10.         Law or regulation, an agreement with the entity or additional requirements applicable to the engagement may provide for broader communication with those charged with governance.  For example, (a) an agreement with the entity may provide for particular matters to be communicated when they arise from services provided by a firm or network firm other than the financial report audit; or (b) the mandate of a public sector auditor may provide for matters to be communicated that come to the auditor's attention as a result of other work, such as performance audits.

Planned Scope and Timing of the Audit (Ref: Para. 15)

A11.         Communication regarding the planned scope and timing of the audit may:

(a)                Assist those charged with governance to understand better the consequences of the auditor's work, to discuss issues of risk and the concept of materiality with the auditor, and to identify any areas in which they may request the auditor to undertake additional procedures; and

(b)                Assist the auditor to understand better the entity and its environment.

A12.         Communicating significant risks identified by the auditor helps those charged with governance understand those matters and why they were determined to be significant risks.  The communication about significant risks may assist those charged with governance in fulfilling their responsibility to oversee the financial reporting process.

A13.         Matters communicated may include:

           * How the auditor plans to address the significant risks of material misstatement, whether due to fraud or error.

           * How the auditor plans to address areas of higher assessed risks of material misstatement.

           * The auditor's approach to the entity's system of internal control.

           * The application of the concept of materiality in the context of an audit.[9]

           * The nature and extent of specialised skill or knowledge needed to perform the planned audit procedures or evaluate the audit results, including the use of an auditor's expert.[10]

           * When ASA 701 applies, the auditor's preliminary views about matters that may be areas of significant auditor attention in the audit and