Communication with Group Management and Communication with Group Management and Those Charged with Governance of the Group

Communication with Group Management and Those Charged with Governance of the Group

Communication with Group Management

1. The group engagement team shall determine which identified deficiencies in internal control to communicate to those charged with governance and group management in accordance with ASA 265.[12] In making this determination, the group engagement team shall consider:
   1. Deficiencies in group‑wide internal control that the group engagement team has identified;
   2. Deficiencies in internal control that the group engagement team has identified in internal controls at components; and
   3. Deficiencies in internal control that component auditors have brought to the attention of the group engagement team.
2. If fraud has been identified by the group engagement team or brought to its attention by a component auditor, see paragraph 41(h) of this Auditing Standard, or information indicates that a fraud may exist, the group engagement team shall communicate this on a timely basis to the appropriate level of group management in order to inform those with primary responsibility for the prevention and detection of fraud of matters relevant to their responsibilities. (Ref: Para. A64)
3. A component auditor may be required by statute, regulation or for another reason, to express an audit opinion on the financial report of a component. In that case, the group engagement team shall request group management to inform component management of any matter of which the group engagement team becomes aware that may be significant to the financial report of the component, but of which component management may be unaware. If group management refuses to communicate the matter to component management, the group engagement team shall discuss the matter with those charged with governance of the group. If the matter remains unresolved, the group engagement team, subject to legal and professional confidentiality considerations, shall consider whether to advise the component auditor not to issue the auditor’s report on the financial report of the component until the matter is resolved. (Ref: Para. A65)

Communication with Those Charged with Governance of the Group

1. The group engagement team shall communicate the following matters with those charged with governance of the group, in addition to those required by ASA 260[13] and other Auditing Standards: (Ref: Para. A66)
   1. An overview of the type of work to be performed on the financial information of the components.
   2. An overview of the nature of the group engagement team’s planned involvement in the work to be performed by the component auditors on the financial information of significant components.