Document ID: chunk:federal_register_of_legislation:F2021C01242:reg:5:p9
Version: federal_register_of_legislation:F2021C01242
Segment Type: reg
Provision Reference: reg 5 (pt 9/12)
Character Range: 29426–32481

evidence about subsequent events (for example, to obtain audit evidence for account balances as at the date of the financial report, such as cut‑off procedures or procedures in relation to subsequent receipts of accounts receivable).

A7.             Paragraph 7 stipulates certain audit procedures in this context that the auditor is required to perform pursuant to paragraph 6.  The subsequent events procedures that the auditor performs may, however, depend on the information that is available and, in particular, the extent to which the accounting records have been prepared since the date of the financial report.  Where the accounting records are not up‑to‑date, and accordingly no interim financial report (whether for internal or external purposes) has been prepared, or minutes of meetings of management or those charged with governance have not been prepared, relevant audit procedures may take the form of inspection of available books and records, including bank statements.  Paragraph A8 gives examples of some of the additional matters that the auditor may consider in the course of these enquiries.

A8.             In addition to the audit procedures required by paragraph 7, the auditor may consider it necessary and appropriate to:

           * Read the entity's latest available budgets, cash flow forecasts and other related management reports for periods after the date of the financial report;

           * Enquire, or extend previous oral or written enquiries, of the entity's legal counsel concerning litigation and claims; or

           * Consider whether written representations covering particular subsequent events may be necessary to support other audit evidence and thereby obtain sufficient appropriate audit evidence.

Enquiry (Ref: Para. 7(b))

A9.             In enquiring of management and, where appropriate, those charged with governance, as to whether any subsequent events have occurred that might affect the financial report, the auditor may enquire as to the current status of items that were accounted for on the basis of preliminary or inconclusive data and may make specific enquiries about the following matters:

           * Whether new commitments, borrowings or guarantees have been entered into.

           * Whether sales or acquisitions of assets have occurred or are planned.

           * Whether there have been increases in capital or issuance of debt instruments, such as the issue of new shares or debentures, or an agreement to merge or liquidate has been made or is planned.

           * Whether any assets have been appropriated by government or destroyed, for example, by fire or flood.

           * Whether there have been any developments regarding contingencies.

           * Whether any unusual accounting adjustments have been made or are contemplated.

           * Whether any events have occurred or are likely to occur that will bring into question the appropriateness of accounting policies used in the financial report, as would be the case, for example, if such events call