Section Identification and Assessment of the Ris - ASA 550 - Related Parties - October 2009 - Identification and Assessment of the Risks of Material Misstatement Associated with Related Party Relationships and Transactions | Zoe
Identification and Assessment of the Risks of Material Misstatement Associated with Related Party Relationships and Transactions
In meeting the ASA 315 requirement to identify and assess the risks of material misstatement,[9] the auditor shall identify and assess the risks of material misstatement associated with related party relationships and transactions and determine whether any of those risks are significant risks. In making this determination, the auditor shall treat identified significant related party transactions outside the entity’s normal course of business as giving rise to significant risks.
If the auditor identifies fraud risk factors (including circumstances relating to the existence of a related party with dominant influence) when performing the risk assessment procedures and related activities in connection with related parties, the auditor shall consider such information when identifying and assessing the risks of material misstatement due to fraud in accordance with ASA 240. (Ref: Para. A6 and A29‑A30)