Guide to Using International Standards on Auditing in - IFAC

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218 17. Forming an Opinion on Financial Statements Chapter Content Requirements and considerations related ong>toong>: • Forming an opinion on the financial statements; and • Preparing an appropriately worded audiong>toong>r’s report. Relevant ISAs 700 Exhibit 17.0-1 Back ong>toong> risk assessment 2 Reporting yes Evaluate the audit evidence obtained Is additional work required? no Determine what additional audit work (if any) is required New/revised risk facong>toong>rs and audit procedures Changes in materiality Communications on audit findings Conclusions on audit procedures performed Prepare the audiong>toong>r’s report Form an opinion based on audit findings Significant decisions Signed audit opinion Notes: 1. Refer ong>toong> ISA 230 for a more complete list of documentation required. 2. Planning (ISA 300) is a continual and iterative process throughout the audit.

219 ong>Guideong> ong>toong> ong>Usingong> ong>Internationalong> ong>Standardsong> on Auditing in the Audits of Small- and Medium-Sized Entities Volume 1—Core Concepts Paragraph # ISA Objective(s) 700.6 The objectives of the audiong>toong>r are: (a) To form an opinion on the financial statements based on an evaluation of the conclusions drawn from the audit evidence obtained; and (b) To express clearly that opinion through a written report that also describes the basis for that opinion. Paragraph # Relevant Extracts from ISAs 700.7 For purposes of the ISAs, the following terms have the meanings attributed below: (a) General purpose financial statements—Financial statements prepared in accordance with a general purpose framework. (b) General purpose framework—A financial reporting framework designed ong>toong> meet the common financial information needs of a wide range of users. The financial reporting framework may be a fair presentation framework or a compliance framework. The term “fair presentation framework” is used ong>toong> refer ong>toong> a financial reporting framework that requires compliance with the requirements of the framework and: (i) Acknowledges explicitly or implicitly that, ong>toong> achieve fair presentation of the financial statements, it may be necessary for management ong>toong> provide disclosures beyond those specifically required by the framework; or (ii) Acknowledges explicitly that it may be necessary for management ong>toong> depart from a requirement of the framework ong>toong> achieve fair presentation of the financial statements. Such departures are expected ong>toong> be necessary only in extremely rare circumstances. The term “compliance framework” is used ong>toong> refer ong>toong> a financial reporting framework that requires compliance with the requirements of the framework, but does not contain the acknowledgements in (i) or (ii) above. (c) Unmodified opinion—The opinion expressed by the audiong>toong>r when the audiong>toong>r concludes that the financial statements are prepared, in all material respects, in accordance with the applicable financial reporting framework. 700.8 Reference ong>toong> “financial statements” in this ISA means “a complete set of general purpose financial statements, including the related notes.” The related notes ordinarily comprise a summary of significant accounting policies and other explanaong>toong>ry information. The requirements of the applicable financial reporting framework determine the form and content of the financial statements, and what constitutes a complete set of financial statements. 700.9 Reference ong>toong> “ong>Internationalong> Financial Reporting ong>Standardsong>” in this ISA means the ong>Internationalong> Financial Reporting ong>Standardsong> issued by the ong>Internationalong> Accounting ong>Standardsong> Board, and reference ong>toong> “ong>Internationalong> Public Secong>toong>r Accounting ong>Standardsong>” means the ong>Internationalong> Public Secong>toong>r Accounting ong>Standardsong> issued by the ong>Internationalong> Public Secong>toong>r Accounting ong>Standardsong> Board.

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