Document ID: chunk:federal_register_of_legislation:F2023C01137:body:0:p26
Version: federal_register_of_legislation:F2023C01137
Segment Type: other
Provision Reference: 
Character Range: 70892–73757

preparation of the financial report.

      * A more limited description of the auditor's responsibilities section is required.

      * In addition to the audit of the financial report, the auditor has other reporting responsibilities required under law.

INDEPENDENT AUDITOR'S REPORT

To the Members of ABC Entity [or Other Appropriate Addressee]

Report on the Audit of the Financial Report[#]

Disclaimer of Opinion

We were engaged to audit the financial report of ABC Entity (the Entity), which comprises the statement of financial position as at 30 June 20X1, the statement of comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, and notes to the financial statements, including material accounting policy information, and the declaration by those charged with governance.[#]

We do not express an opinion on the accompanying financial report of the Entity.  Because of the significance of the matters described in the Basis for Disclaimer of Opinion section of our report, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on the financial report.

Basis for Disclaimer of Opinion

We were not appointed as auditors of the Entity until after 30 June 20X1 and thus did not observe the counting of physical inventories at the beginning and end of the year.  We were unable to satisfy ourselves by alternative means concerning the inventory quantities held at 30 June 20X0 and 20X1, which are stated in the statements of financial position at $xxx and $xxx, respectively.  In addition, the introduction of a new computerised accounts receivable system in September 20X1 resulted in numerous errors in accounts receivable.  As of the date of our report, management was still in the process of rectifying the system deficiencies and correcting the errors.  We were unable to confirm or verify by alternative means accounts receivable included in the statement of financial position at a total amount of $xx as at 30 June 20X1.  As a result of these matters, we were unable to determine whether any adjustments might have been found necessary in respect of recorded or unrecorded inventories and accounts receivable, and the elements making up the statement of comprehensive income, statement of changes in equity and statement of cash flows.

Responsibilities of Management and Those Charged with Governance for the Financial Report[†]

[Reporting in accordance with ASA 700 – see Illustration 3.]

Auditor's Responsibilities for the Audit of the Financial Report

Our responsibility is to conduct an audit of the Entity's financial report in accordance with Australian Auditing Standards and to issue an auditor's report.  However, because of the matters described in the Basis for Disclaimer of Opinion section of our report, we were not able to