Document ID: chunk:federal_register_of_legislation:F2025C00096:body:0:p50
Version: federal_register_of_legislation:F2025C00096
Segment Type: other
Provision Reference: 
Character Range: 143490–146507

selected for testing also may be helpful in relation to the risks of material misstatement of the group financial report due to fraud (also see paragraph A136).

The Nature and Extent of Further Audit Procedures

 1.       In response to the assessed risks of material misstatement, the group auditor may determine the following scope of work to be appropriate at a component (with the involvement of component auditors, as applicable):

           * Design and perform further audit procedures on the entire financial information of the component;

           * Design and perform further audit procedures on one or more classes of transactions, account balances or disclosures; or

           * Perform specific further audit procedures.

 1.       Although the group auditor takes responsibility for the nature, timing and extent of further audit procedures to be performed, component auditors can be, and often are, involved in all phases of the group audit, including in the design and performance of further audit procedures.

Design and Perform Further Audit Procedures on the Entire Financial Information of the Component

 1.       The group auditor may determine that designing and performing further audit procedures on the entire financial information of a component is an appropriate approach, including when:

           * Audit evidence needs to be obtained on all or a significant proportion of a component's financial information to respond to the assessed risks of material misstatement of the group financial report.

           * There is a pervasive risk of material misstatement of the group financial report due to the existence of events or conditions at the component that may be relevant to the group auditor's evaluation of group management's assessment of the group's ability to continue as a going concern.

Design and Perform Further Audit Procedures on One or More Classes of Transactions, Account Balances or Disclosures

 1.       The group auditor may determine that designing and performing further audit procedures on one or more particular classes of transactions, account balances, or disclosures of the financial information of a component is an appropriate approach to address assessed risks of material misstatement of the group financial report.  For example, a component may have limited operations but holds a significant portion of the land and buildings of the group or has significant tax balances.

Perform Specific Further Audit Procedures

 1.       The group auditor may determine that designing and performing specific further audit procedures on the financial information of a component is an appropriate approach, such as when audit evidence needs to be obtained for one or more relevant assertions only.  For example, the group auditor may centrally test the class of transaction, account balance or disclosure and may require the component auditor to perform specific further audit procedures at the component (e.g., specific further audit procedures related to