Document ID: chunk:federal_register_of_legislation:F2023C01128:reg:17:p20
Version: federal_register_of_legislation:F2023C01128
Segment Type: reg
Provision Reference: reg 17 (pt 20/25)
Character Range: 62419–65567

may communicate preliminary views about key audit matters when discussing the planned scope and timing of the audit (see paragraph A13), and the auditor also may have more frequent communications to further discuss such matters when communicating about significant audit findings.

           * Communications regarding independence may be appropriate whenever significant judgements are made about threats to independence and how threats to independence that are not at an acceptable level will be addressed, for example, when accepting an engagement to provide non‑audit services, and at a concluding discussion.

           * Communications regarding findings from the audit, including the auditor's views about the qualitative aspects of the entity's accounting practices, may also be made as part of the concluding discussion.

           * When auditing both general purpose and special purpose financial reports, it may be appropriate to co‑ordinate the timing of communications.

A50.         Other factors that may be relevant to the timing of communications include:

           * The size, operating structure, control environment, and legal structure of the entity being audited.

           * Any legal obligation to communicate certain matters within a specified timeframe.

           * The expectations of those charged with governance, including arrangements made for periodic meetings or communications with the auditor.

           * The time at which the auditor identifies certain matters, for example, the auditor may not identify a particular matter (e.g., noncompliance with a law) in time for preventive action to be taken, but communication of the matter may enable remedial action to be taken.

Adequacy of the Communication Process (Ref: Para. 22)

A51.         The auditor need not design specific procedures to support the evaluation of the two‑way communication between the auditor and those charged with governance; rather, that evaluation may be based on observations resulting from audit procedures performed for other purposes.  Such observations may include:

           * The appropriateness and timeliness of actions taken by those charged with governance in response to matters raised by the auditor.  Where significant matters raised in previous communications have not been dealt with effectively, it may be appropriate for the auditor to enquire as to why appropriate action has not been taken, and to consider raising the point again.  This avoids the risk of giving an impression that the auditor is satisfied that the matter has been adequately addressed or is no longer significant.

           * The apparent openness of those charged with governance in their communications with the auditor.

           * The willingness and capacity of those charged with governance to meet with the auditor without management present.

           * The apparent ability of those charged with governance to fully comprehend matters raised by the auditor, for example, the extent to which those charged with governance probe issues, and question recommendations made to them.

           * Difficulty in establishing