IntroductionIntroduction

Introduction

1. This Preamble sets out the intentions of the Auditing and Assurance Standards Board (AUASB), as to how AUASB Standards are to be understood, interpreted and applied. The AUASB issues AUASB Standards comprising:
   1. Auditing Standards (“ASAs”);
   2. Standards on Review Engagements (“ASREs”);
   3. Standards on Assurance Engagements (“ASAEs”); and
   4. Standards on Related Services (“ASRSs”).
2. An auditor shall apply AUASB Standards in conjunction with paragraphs 1 to 49 of this Preamble.
3. The AUASB derives its functions and powers under section 227B of the Australian Securities and Investments Commission Act 2001. The AUASB:
   1. makes Auditing Standards under section 336 of the Corporations Act 2001 (the Act) for the purposes of the corporations legislation; and
   2. formulates auditing and assurance standards for other purposes.

Auditing Standards made under Section 336 of the Act

Application

1. Auditing Standards apply to:
   1. an audit of a financial report for a financial year, or an audit or review[1] of a financial report for a half-year, prepared in accordance with Part 2M.3 of the Act;
   2. an audit of a financial report prepared for any other purpose; or
   3. a review by the independent auditor of the entity, of interim financial reports, prepared for any other purpose.1
2. Although Auditing Standards are written mainly in the context of an audit of a financial report, they apply also, as appropriate, to the audit of other financial information.

Enforcement

1. Section 307A of the Act requires auditors to conduct audits and reviews of the financial reports[2] prepared under Part 2M.3 of the Act, in accordance with Auditing Standards. AUASB Standards may have legal enforcement under legislation other than the Act.

Auditing and Assurance Standards for Other Purposes

1. Auditing and assurance standards for other purposes consist of standards that are designed for subject-specific areas. They include, for example, assurance engagements that relate to:

• reviews (other than a review by the independent auditor of the entity, of interim financial information, including interim financial reports, prepared for other purposes);
• evaluating the efficiency and/or effectiveness of an entity’s activities;
• prospective financial information; and
• the effectiveness of internal controls.