Action if Management Refuses to Provide Action if Management Refuses to Provide Representations

Action if Management Refuses to Provide Representations

22 If management refuses to provide a representation that the auditor considers necessary, this constitutes a scope limitation and the auditor shall express a qualified opinion or a disclaimer of opinion.

23 In such circumstances the auditor would ordinarily:

(a) evaluate any reliance placed on other representations made by management during the course of the audit;

(b) draw to the attention of those charged with governance or management any relevant statutory and/or regulatory provision which gives the auditor access to records and information. For example, under section 310 of the Corporations Act 2001, the auditor has a right of access at all reasonable times to the books of a company, registered scheme or disclosing entity, and may require from any officer to give the auditor information and explanations or other assistance for the purposes of the audit or review; and

(c) consider if the other implications of the refusal may have any additional effect on the auditor’s report. For example, section 307(b) of the Corporations Act 2001 requires an auditor to form an opinion as to whether all information, explanations and assistance necessary for the conduct of the audit have been given, and in accordance with section 308(3)(b) to state in the auditor’s report particulars of any deficiency, failure or shortcoming in respect of these matters.