What is considered other information in financial statements?

What is considered other information in financial statements?

The scope of other information ISA 720 (Revised) applies to “other information.” Other information is financial or non-financial information (other than financial statements and the auditor’s report thereon) included in an entity’s annual report.

What information is included in the audited financial statements?

Every business keeps records of its operations and transactions, and accountants take this information to produce four basic financial statements: a profit and loss statement, balance sheet, statement of cash flows and statement of changes in owners’ equity.

When audited financial statements are presented in a client’s document containing other information?

When audited financial statements are presented in a client’s document containing other information, the auditor should: a. Perform inquiry and analytical procedures to ascertain whether the other information is reasonable.

What is the auditor’s responsibility with regard the other information in documents containing audited financial statements?

The auditor’s responsibility with respect to information in a document does not extend beyond the financial information identified in his report, and the auditor has no obligation to perform any procedures to corroborate other information contained in a document.

Does the audit opinion extend to the other information?

The auditor’s opinion on the financial statements does not cover the other information, nor does this ISA require the auditor to obtain audit evidence beyond that required to form an opinion on the financial statements.

What are the four phases of a financial statement audit?

There are four phases of a Financial Statement Audit: planning/risk assessment, internal control assessment, substantive testing and reporting. The audit phases last several months each, may overlap, and are continuous year after year.

What is covered in an audit?

Auditing, specifically financial auditing is the examination of a business’s financial records to determine their accuracy and their adherence to the accounting standards and other applicable rules.

What is the auditors responsibility for reporting on other information accompanying financial statements?

Auditors are required to report on other information only if it is misstated or inconsistent with the financial statements. C) Auditors are required to provide reasonable assurance with respect to whether the other information is presented in accordance with generally accepted accounting principles.

What should the auditor do if the information is not consistent with the financial statements?

If the auditor concludes that there is a material inconsistency, he should determine whether the financial statements, his report, or both require revision. If he concludes that they do not require revision, he should request the client to revise the other information.