Requests by Those Charged with GovernancRequests by Those Charged with Governance and Management

Requests by Those Charged with Governance and Management

29 When the auditor seeks to confirm certain balances or other information, and those charged with governance or management request the auditor not to do so, the auditor shall consider whether there are valid grounds for such a request and obtain audit evidence to support the validity of such request. If the auditor agrees to a request by those charged with governance or management not to seek external confirmation regarding a particular matter, the auditor shall apply alternative audit procedures to obtain sufficient appropriate audit evidence regarding that matter.

30 If the auditor does not accept the validity of a request by those charged with governance or management and is prevented from carrying out the confirmations, there has been a limitation on the scope of the auditor’s work and the auditor shall consider the possible impact on the auditor’s report.

31 When considering the reasons provided by those charged with governance or management, the auditor applies an attitude of professional scepticism and considers whether the request:

(a) has any implications regarding the integrity of those charged with governance or management; and

(b) may indicate the possible existence of fraud or error.

ASA 240 The Auditor’s Responsibility to Consider Fraud in an Audit of a Financial Report, and ASA 250 Considerations of Laws and Regulations in an Audit of a Financial Report, provide mandatory requirements and explanatory guidance in circumstances where the auditor believes that fraud or error exists. Under ASA 500, the auditor needs to consider whether the alternative audit procedures will provide sufficient appropriate audit evidence regarding that matter.