ISSAI 1240

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ISSAI 1240 ISA 240 International Auditing and Assurance Standards Board International Federation of Accountants 545 Fifth Avenue, 14 th Floor New York, New York 10017 USA This International Standard on Auditing (ISA) 240, “The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements” was prepared by the International Auditing and Assurance Standards Board (IAASB), an independent standard-setting body within the International Federation of Accountants (IFAC). The objective of the IAASB is to serve the public interest by setting high quality auditing and assurance standards and by facilitating the convergence of international and national standards, thereby enhancing the quality and uniformity of practice throughout the world and strengthening public confidence in the global auditing and assurance profession. This publication may be downloaded free of charge from the IFAC website: http://www.ifac.org. The approved text is published in the English language. The mission of IFAC is to serve the public interest, strengthen the worldwide accountancy profession and contribute to the development of strong international economies by establishing and promoting adherence to high quality professional standards, furthering the international convergence of such standards and speaking out on public interest issues where the profession’s expertise is most relevant. Copyright © April 2009 by the International Federation of Accountants (IFAC). All rights reserved. Permission is granted to make copies of this work provided that such copies are for use in academic classrooms or for personal use and are not sold or disseminated and provided that each copy bears the following credit line: “Copyright © April 2009 by the International Federation of Accountants (IFAC). All rights reserved. Used with permission of IFAC. Contact permissions@ifac.org for permission to reproduce, store or transmit this document.” Otherwise, written permission from IFAC is required to reproduce, store or transmit, or to make other similar uses of, this document, except as permitted by law. Contact permissions@ifac.org. ISBN: 978-1-60815-002-1 1 236 The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements
ISSAI 1240 ISA 240 INTERNATIONAL STANDARD ON AUDITING 240 THE AUDITOR’S RESPONSIBILITIES RELATING TO FRAUD IN AN AUDIT OF FINANCIAL STATEMENTS Introduction (Effective for audits of financial statements for periods beginning on or after December 15, 2009) CONTENTS Paragraph Scope of this ISA ........................................................................................ 1 Characteristics of Fraud .............................................................................. 2-3 Responsibility for the Prevention and Detection of Fraud .......................... 4-8 Effective Date ............................................................................................. 9 Objectives .................................................................................................. 10 Definitions .................................................................................................. 11 Requirements Professional Skepticism .............................................................................. 12-14 Discussion among the Engagement Team .................................................. 15 Risk Assessment Procedures and Related Activities .................................. 16-24 Identification and Assessment of the Risks of Material Misstatement Due to Fraud .................................................................. 25-27 Responses to the Assessed Risks of Material Misstatement Due to Fraud ........................................................................................ 28-33 Evaluation of Audit Evidence ..................................................................... 34-37 Auditor Unable to Continue the Engagement ............................................. 38 Written Representations .............................................................................. 39 Communications to Management and with Those Charged with Governance .................................................................................. 40-42 Communications to Regulatory and Enforcement Authorities ................... 43 Documentation ............................................................................................ 44-47 2 The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements 237
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