Document ID: chunk:federal_register_of_legislation:F2023C00337:reg:1:p2
Version: federal_register_of_legislation:F2023C00337
Segment Type: reg
Provision Reference: reg 1 (pt 2/23)
Character Range: 12529–15684

to and including 15 March 2023 (see Compilation Details).

Auditing Standard ASA 210

Agreeing the Terms of Audit Engagements

Application

Aus 0.1 This Auditing Standard applies to:

(a) an audit of a financial report for a financial year, or an audit of a financial report for a half‑year, in accordance with the Corporations Act 2001; and

(b) an audit of a financial report, or a complete set of financial statements, for any other purpose.

Aus 0.2 This Auditing Standard also applies, as appropriate, to an audit of other historical financial information.

Operative Date

Aus 0.3 This Auditing Standard is operative for financial reporting periods commencing on or after 1 January 2010.  [Note: For operative dates of paragraphs changed or added by an Amending Standard, see Compilation Details.]

Introduction

Scope of this Auditing Standard

      1. This Auditing Standard deals with the auditor's responsibilities in agreeing the terms of the audit engagement with management and, where appropriate, those charged with governance.  This includes establishing that certain preconditions for an audit, responsibility for which rests with management and, where appropriate, those charged with governance, are present.  ASA 220[1] deals with those aspects of engagement acceptance that are within the control of the auditor.  (Ref: Para. A1)

Effective Date

2.                   [Deleted by the AUASB.  Refer Aus 0.3]

Objective

3.                   The objective of the auditor is to accept or continue an audit engagement only when the basis upon which it is to be performed has been agreed, through:

(a)                Establishing whether the preconditions for an audit are present; and

(b)                Confirming that there is a common understanding between the auditor and management and, where appropriate, those charged with governance of the terms of the audit engagement.

Definition

4.                   For the purposes of this Auditing Standard, the following term has the meaning attributed below:

Preconditions for an audit means the use by management of an acceptable financial reporting framework in the preparation of the financial report and the agreement of management and, where appropriate, those charged with governance to the premise[2] on which an audit is conducted.

5.                   For the purposes of this Auditing Standard, references to "management" should be read hereafter as "management and, where appropriate, those charged with governance."

Requirements

6.                   In order to establish whether the preconditions for an audit are present, the auditor shall:

(a)                Determine whether the financial reporting framework to be applied in the preparation of the financial report is acceptable; and (Ref: Para. A2‑A10)

(b)                Obtain the agreement of management that it acknowledges and understands its responsibility: (Ref: Para. A11‑A14, A19, A21-Aus A21.1)

(i)                 For the preparation of the financial report in accordance with the applicable financial reporting framework, including where relevant their fair presentation; (Ref: Para. A15)

(ii)