Document ID: chunk:federal_register_of_legislation:F2025L00107:front:0:p166
Version: federal_register_of_legislation:F2025L00107
Segment Type: other
Provision Reference: 
Character Range: 517024–520338

the prescribed control, in the case of tests of controls, or a misstatement, in the case of tests of details.

         3.                 Investigating the nature and cause of deviations or misstatements identified and evaluating their possible effect on the purpose of the procedure and on other areas of the engagement.

         4.                 Evaluating:

                 1.                  The results of the sample, including, for tests of details, projecting misstatements found in the sample to the population; and

                 2.                Whether the use of sampling has provided an appropriate basis for conclusions about the population that has been tested.

Estimates and Forward-Looking Information (Ref: Para. 146L, 146R)

 1.       Estimation uncertainty may arise due to incomplete knowledge about the measurement of an area, activity or event, or the measurement or evaluation of an estimate may depend on the forecast of an outcome of one or more events or conditions.

 2.       Forward-looking information may include forecasts, projections, or future plans of the entity. Forward-looking information may be prepared using scenarios based on best-estimate assumptions or hypothetical assumptions, which are affected by management's judgement.  A future event, occurrence or action relating to the sustainability matters may be subject to greater uncertainty, and therefore ordinarily able to be evaluated with less precision than historical events, occurrences or actions. Disclosures become more speculative as the length of the period covered increases and the uncertainty may increase the further into the future the period to which the forward-looking information relates.

 3.       The applicable criteria may require disclosure of the entity's intended future strategy, targets, or other intentions. For such forward-looking information, the practitioner is not required to obtain evidence about whether the strategy, target or intention will be achieved, or to come to a conclusion to that effect.

A453R. When designing the procedures required by paragraph 146R(a), the practitioner's procedures may include:

 1.                 Based on the practitioner's knowledge and experience, considering if there are reasons to believe that the forward-looking information is clearly unrealistic.

 2.                 Inspecting minutes of meetings or reports on the business's operations to evaluate whether:

         1.                  Management or those charged with governance have an intention and ability to follow the strategy;

         2.                The target or intention exists; or

         3.              There is a reasonable basis for the intended strategy or target.

     1.

 2.       Regardless of the source or degree of uncertainty, complexity or subjectivity, or the extent of management's judgement, it is necessary for management to appropriately apply the applicable criteria when developing estimates and forward-looking information and the related disclosures, including selecting and using appropriate methods, assumptions and data.

A455L. In some limited assurance engagements, it may be appropriate for the practitioner to undertake one or more of the procedures in paragraph 146R.

Evaluating Whether the Method Has Been Appropriately