Document ID: chunk:federal_register_of_legislation:F2022C01208:reg:14:p13
Version: federal_register_of_legislation:F2022C01208
Segment Type: reg
Provision Reference: reg 14 (pt 13/57)
Character Range: 44674–47698

material and pervasive to the financial report that the auditor concludes a qualified conclusion is not adequate to disclose the misleading or incomplete nature of the financial report, the auditor shall express an adverse conclusion.  (Ref: Para. A46)

Limitation on Scope (Ref: Para. A47)

42.               When the auditor is unable to complete the review, the auditor shall communicate, in writing, to the appropriate level of management and to those charged with governance the reason why the review cannot be completed, and consider whether it is appropriate to issue a review report.

Limitation on Scope Imposed by Management

43.               Unless required by law or regulation, an auditor shall not accept an engagement to review a financial report when management has imposed a limitation on the scope of the auditor's review.  (Ref: Para. A48)

44.               If, after accepting the engagement, management imposes a limitation on the scope of the review, the auditor shall request management to remove the limitation.  If management refuses the auditor's request to remove the limitation, the auditor shall communicate, in writing, to the appropriate level of management and those charged with governance, the reason(s) why the review cannot be completed.  (Ref: Para. A49)

45.               If management and, where appropriate, those charged with governance, refuses the auditor's request to remove a limitation that has been imposed on the scope of the review, but there is a legal or regulatory requirement for the auditor to issue a report, the auditor shall issue a disclaimer of conclusion or qualified conclusion report, as appropriate, containing the reason(s) why the review cannot be completed.  (Ref: Para A50)

46.               When the auditor disclaims a conclusion on the financial report, the auditor shall not include the elements required by paragraph 35(b).

47.               When the auditor disclaims a conclusion on the financial report, the auditor shall amend the description of the auditor's responsibilities required by paragraph 38 to include only:

(a)                A statement that the auditor's responsibility is to conduct a review of the entity's financial report in accordance with ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity;

(b)                A statement that, however, because of the matter(s) described in the Basis for Disclaimer of Conclusion section, the auditor was not able to obtain sufficient evidence to provide a basis for a review conclusion on the financial report.

(c)                The statement about auditor independence and other ethical responsibilities required by paragraph 35(c).

Other Limitations on Scope Not Imposed by Management (Ref: Para. A51‑A52)

    48.               The auditor shall express a qualified conclusion when, in rare circumstances, there is a limitation on the scope of the auditor's work that is confined to one or more specific matters, which while material, is not