Acceptance and ContinuanceAcceptance and Continuance

Acceptance and Continuance

1. In applying ASA 220, the group engagement partner shall determine whether sufficient appropriate audit evidence can reasonably be expected to be obtained in relation to the consolidation process and the financial information of the components on which to base the group audit opinion. For this purpose, the group engagement team shall obtain an understanding of the group, its components, and their environments that is sufficient to identify components that are likely to be significant components. Where component auditors will perform work on the financial information of such components, the group engagement partner shall evaluate whether the group engagement team will be able to be involved in the work of those component auditors to the extent necessary to obtain sufficient appropriate audit evidence. (Ref: Para. A10‑A12)
2. If the group engagement partner concludes that:
   1. it will not be possible for the group engagement team to obtain sufficient appropriate audit evidence due to restrictions imposed by group management; and
   2. the possible effect of this inability will result in a disclaimer of opinion on the group financial report,[5]

the group engagement partner shall either:

• in the case of a new engagement, not accept the engagement, or, in the case of a continuing engagement, withdraw from the engagement, where withdrawal is possible under applicable law or regulation; or
• where law or regulation prohibits an auditor from declining an engagement or where withdrawal from an engagement is not otherwise possible, having performed the audit of the group financial report to the extent possible, disclaim an opinion on the group financial report. (Ref: Para. A13‑A19)

Terms of Engagement

1. The group engagement partner shall agree on the terms of the group audit engagement in accordance with ASA 210.[6] (Ref: Para. A20‑A21)