Document ID: chunk:federal_register_of_legislation:F2025C00096:body:0:p24
Version: federal_register_of_legislation:F2025C00096
Segment Type: other
Provision Reference: 
Character Range: 69153–72428

* Communication with group management;

           * Communication with those charged with governance of the group; and

           * When applicable, communication with component management or the predecessor auditor.

 1.          For a recurring engagement, the ability to obtain sufficient appropriate audit evidence may be affected by significant changes in, for example:

           * The group structure (e.g., acquisitions, disposals, joint ventures, reorganisations, or changes in how the group financial reporting system is organised).

           * Components' activities that are significant to the group.

           * The composition of those charged with governance of the group, group management, or key management of components for which audit procedures are expected to be performed.

           * The group auditor's understanding of the integrity and competence of group or component management.

           * The applicable financial reporting framework.

         Aus A34.1 Section 323B of the Corporations Act 2001 (the Act) requires the officer or auditor of a controlled entity to give the principal auditor access to the controlled entity's books; and give the auditor any information, explanation or assistance required under section 323A of the Act.

 1.          There may be additional complexities with obtaining sufficient appropriate audit evidence in a group audit when components are located in jurisdictions other than the group auditor's jurisdiction because of cultural and language differences, and different laws or regulations.  For example, law or regulation may restrict the component auditor from providing documentation outside of its jurisdiction, or war, civil unrest or outbreaks of disease may restrict the group auditor's access to relevant component auditor audit documentation.  Paragraph A180 includes possible ways to address these situations.

 2.          Restrictions may be imposed after the group engagement partner's acceptance of the group audit engagement that may affect the engagement team's ability to obtain sufficient appropriate audit evidence.  Such restrictions may include those affecting:

           * The group auditor's access to component information, management or those charged with governance of components, or the component auditors (including relevant audit documentation sought by the group auditor) (see paragraphs 20 and 21); or

           * The work to be performed on the financial information of components.

    Paragraphs A45–A46 explain the possible effect of such restrictions on the auditor's report on the group financial report.

Agreeing the Terms of Audit Engagements (Ref: Para. 19)

 1.          ASA 210[46] requires the auditor to agree the terms of the audit engagement with management or those charged with governance, as appropriate.  The terms of engagement identify the applicable financial reporting framework.  Additional matters that may be included in the terms of a group audit engagement include:

           * Communications between the group auditor and component auditors should be unrestricted to the extent possible under laws or regulations;

           * Important communications between component auditors and those charged with governance of the component