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ASA 210 - Agreeing the Terms of Audit Engagements - October 2009
Agreement on Audit Engagement TermsAgreement on Audit Engagement Terms
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Agreement on Audit Engagement Terms
- The auditor shall agree the terms of the audit engagement with management or those charged with governance, as appropriate. (Ref: Para. A22)
- Subject to paragraph 11 of this Auditing Standard, the agreed terms of the audit engagement shall be recorded in an audit engagement letter or other suitable form of written agreement and shall include: (Ref: Para. A23‑A26)
- The objective and scope of the audit of the financial report;
- The responsibilities of the auditor;
- The responsibilities of management;
- Identification of the applicable financial reporting framework for the preparation of the financial report; and
- Reference to the expected form and content of any reports to be issued by the auditor and a statement that there may be circumstances in which a report may differ from its expected form and content. (Ref: Para. A25)
- If law or regulation prescribes in sufficient detail the terms of the audit engagement referred to in paragraph 10 of this Auditing Standard, the auditor need not record them in a written agreement, except for the fact that such law or regulation applies and that management acknowledges and understands its responsibilities as set out in paragraph 6(b) of this Auditing Standard. (Ref: Para. A23, A27‑A29)
- If law or regulation prescribes responsibilities of management similar to those described in paragraph 6(b) of this Auditing Standard, the auditor may determine that the law or regulation includes responsibilities that, in the auditor’s judgement, are equivalent in effect to those set out in that paragraph. For such responsibilities that are equivalent, the auditor may use the wording of the law or regulation to describe them in the written agreement. For those responsibilities that are not prescribed by law or regulation such that their effect is equivalent, the written agreement shall use the description in paragraph 6(b) of this Auditing Standard. (Ref: Para. A27)