Engagements to Report on Summary Financial Statements
CAS 810
Engagements to Report on Summary Financial Statements
CAS 810
Definitions
- Summary F/S – Historical financial information that is derived from F/S but that contains less detail than the F/S
Engagement Acceptance
- The auditor should only accept an engagement to report on summary F/S only when the auditor has been engaged to conduct an audit of the complete F/S from which the summary F/S are derived
- Before accepting an engagement to report on summary F/S:
- Determine whether the applied criteria are acceptable
- Obtain the agreement of management that it acknowledges and understands its responsibility:
- For the preparation of the summary F/S in accordance with the applied criteria
- To make the audited F/S available to the intended users of the summary F/S without undue difficulty
- To include the auditor’s report on the summary F/S in any document that contains the summary F/S and that indicates that the auditor has reported on them
- Agree with management the form of opinion to be expressed on the summary F/S
Nature of Procedures
- Must Evaluate whether the summary F/S adequately disclose their summarized nature and identify the audited F/S
- When summary F/S are not accompanied by the audited F/S, evaluate whether they describe from whom or where the audited F/S are available
- Evaluate whether the summary F/S adequately disclose the applied criteria
- Compare the summary F/S with the related information in the audited F/S to determine whether the summary F/S agree with the related information in the audited F/S
- Evaluate whether the summary F/S are prepared in accordance with the applied criteria
- Evaluate whether the summary F/S contain the information necessary, and are at an appropriate level of aggregation, so as not to be misleading
- Evaluate whether the audited F/S are available to the intended users of the summary F/S without undue difficulty
Form of Opinion and Other Issues
- When issuing an unmodified opinion on the summary F/S, use one of the following phrases:
- The summary F/S are consistent, in all material respects, with the audited F/S, in accordance with IFRS/ASPE, ETC…
- The summary F/S are a fair summary of the audited F/S, in accordance with IFRS/ASPE, ETC…
- The auditor’s report on the summary F/S may be dated later than the date of the auditor’s report on the audited F/S (make sure to state in the audit report that the summary F/S and audited F/S do not reflect events that occurred subsequent to ] the audit report date on the complete audited F/S)
- When the complete audited F/S contains a qualified opinion, but the auditor is satisfied that the summary F/S are consistent or are a fair summary of the audited F/S, the audit report on the summary F/S should:
- State that the auditor’s report on the audited F/S contains a qualified opinion; and
- Describe:
- The basis for the qualified opinion on the audited F/S
- The effect of the qualification on the summary F/S, if any
- When the complete audited F/S contains an adverse or disclaimer of opinion, the audit report on the summary F/S should:
- State that the auditor’s report on the audited F/S contains an adverse or disclaimer of opinion
- Describe the basis for that adverse or disclaimer of opinion
- State that, due to the adverse or disclaimer of opinion, it is inappropriate to express an opinion on the summary F/S
- If the summary F/S are not consistent with or are not a fair summary of the audited F/S, express an adverse opinion on the summary F/S