Forming an Opinion on the Financial RepoForming an Opinion on the Financial Report

Forming an Opinion on the Financial Report

1. The auditor shall form an opinion on whether the financial report is prepared, in all material respects, in accordance with the applicable financial reporting framework.[7],[8]
2. In order to form that opinion, the auditor shall conclude as to whether the auditor has obtained reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error. That conclusion shall take into account:
   1. The auditor’s conclusion, in accordance with ASA 330, whether sufficient appropriate audit evidence has been obtained;[9]
   2. The auditor’s conclusion, in accordance with ASA 450, whether uncorrected misstatements are material, individually or in aggregate;[10] and
   3. The evaluations required by paragraphs 12‑15 of this Auditing Standard.
3. The auditor shall evaluate whether the financial report is prepared, in all material respects, in accordance with the requirements of the applicable financial reporting framework. This evaluation shall include consideration of the qualitative aspects of the entity’s accounting practices, including indicators of possible bias in management’s judgements. (Ref: Para. A1‑A3)
4. In particular, the auditor shall evaluate whether, in view of the requirements of the applicable financial reporting framework:
   1. The financial report adequately discloses the significant accounting policies selected and applied;
   2. The accounting policies selected and applied are consistent with the applicable financial reporting framework and are appropriate;
   3. The accounting estimates made by management are reasonable;
   4. The information presented in the financial report is relevant, reliable, comparable and understandable;
   5. The financial report provides adequate disclosures to enable the intended users to understand the effect of material transactions and events on the information conveyed in the financial report; and (Ref: Para. A4)
   6. The terminology used in the financial report, including the title of each financial statement, is appropriate.
5. When the financial report is prepared in accordance with a fair presentation framework, the evaluation required by paragraphs 12‑13 of this Auditing Standard shall also include whether the financial report achieves fair presentation. The auditor’s evaluation as to whether the financial report achieves fair presentation shall include consideration of:
   1. The overall presentation, structure and content of the financial report; and