Document ID: chunk:federal_register_of_legislation:F2023C01136:reg:9:p8
Version: federal_register_of_legislation:F2023C01136
Segment Type: reg
Provision Reference: reg 9 (pt 8/24)
Character Range: 25995–28922

to include additional communication in the auditor's report through the use of Emphasis of Matter paragraphs and Other Matter paragraphs when the auditor considers it necessary to do so.  In such cases, these paragraphs are presented separately from the Key Audit Matters section in the auditor's report.  When a matter has been determined to be a key audit matter, the use of such paragraphs is not a substitute for the description of the individual key audit matter in accordance with paragraph 13.[13]  ASA 706 provides further guidance on the relationship between key audit matters and Emphasis of Matter paragraphs in accordance with that Auditing Standard.[14]

Determining Key Audit Matters (Ref: Para. 9–10)

A9.             The auditor's decision‑making process in determining key audit matters is designed to select a smaller number of matters from the matters communicated with those charged with governance, based on the auditor's judgement about which matters were of most significance in the audit of the financial report of the current period.

A10.         The auditor's determination of key audit matters is limited to those matters of most significance in the audit of the financial report of the current period, even when the comparative financial report is presented (i.e., even when the auditor's opinion refers to each period for which the financial report is presented).[15]

A11.         Notwithstanding that the auditor's determination of key audit matters is for the audit of the financial report of the current period and this Auditing Standard does not require the auditor to update key audit matters included in the prior period's auditor's report, it may nevertheless be useful for the auditor to consider whether a matter that was a key audit matter in the audit of the financial report of the prior period continues to be a key audit matter in the audit of the financial report of the current period.

Matters that Required Significant Auditor Attention (Ref: Para. 9)

A12.         The concept of significant auditor attention recognises that an audit is risk‑based and focuses on identifying and assessing the risks of material misstatement of the financial report, designing and performing audit procedures responsive to those risks, and obtaining audit evidence that is sufficient and appropriate to provide a basis for the auditor's opinion.  For a particular account balance, class of transactions or disclosure, the higher an assessed risk of material misstatement at the assertion level, the more judgement is often involved in planning and performing the audit procedures and evaluating the results thereof.  In designing further audit procedures, the auditor is required to obtain more persuasive audit evidence the higher the auditor's assessment of risk.[16]  When obtaining more persuasive audit evidence because of a higher assessment of risk, the auditor may increase the quantity