Written Representations (Ref: Para. 22)Written Representations (Ref: Para. 22)

Written Representations (Ref: Para. 22)

1. ASA 580[28] discusses the use of written representations. Depending on the nature, materiality and extent of estimation uncertainty, written representations about accounting estimates recognised or disclosed in the financial report may include representations:

• About the appropriateness of the measurement processes, including related assumptions and models, used by management in determining accounting estimates in the context of the applicable financial reporting framework, and the consistency in application of the processes.
• That the assumptions appropriately reflect management’s intent and ability to carry out specific courses of action on behalf of the entity, where relevant to the accounting estimates and disclosures.
• That disclosures related to accounting estimates are complete and appropriate under the applicable financial reporting framework.
• That no subsequent event requires adjustment to the accounting estimates and disclosures included in the financial report.

1. For those accounting estimates not recognised or disclosed in the financial report, written representations may also include representations about:

• The appropriateness of the basis used by management for determining that the recognition or disclosure criteria of the applicable financial reporting framework have not been met (see paragraph A114).
• The appropriateness of the basis used by management to overcome the presumption relating to the use of fair value set forth under the entity’s applicable financial reporting framework, for those accounting estimates not measured or disclosed at fair value (see paragraph A115).