ASA 701 - Modifications to the Auditor’s Report - April 2006
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Introduction
4 The purpose of this Auditing Standard is to establish mandatory requirements and to provide explanatory guidance on the circumstances when the auditor’s report is modified and the form and the content of the modifications to the auditor’s report in those circumstances.
5 ASA 700 The Auditor’s Report on a General Purpose Financial Report, establishes mandatory requirements and provides explanatory guidance on the form and content of the auditor’s report on a general purpose financial report prepared in accordance with a financial reporting framework designed to achieve fair presentation when the auditor is able to express an unqualified opinion and no modification to the auditor’s report is necessary. ASA 800 The Auditor’s Report on Special Purpose Audit Engagements, establishes mandatory requirements and provides explanatory guidance on the form and content of the auditor’s report in other audit engagements. This Auditing Standard describes how the auditor’s report wording is modified in the following situations:
Matters that Do Not Affect the Auditor’s Opinion
(a) Emphasis of matter.
Matters that Do Affect the Auditor’s Opinion
(a) Qualified opinion.
(b) Disclaimer of opinion.
(c) Adverse opinion.
6 Uniformity in the form and content of each type of modified auditor’s report will further the user’s understanding of such auditor’s reports. Accordingly, this Auditing Standard includes suggested wording of modifying phrases for use when issuing modified auditor’s reports.
7 The illustrative auditor’s reports in this Auditing Standard are based on the auditor’s report on a general purpose financial report, prepared in accordance with the requirements of the Corporations Act 2001 and ASA 700. The principles relating to the circumstances when the auditor’s report is modified are, however, also applicable to reports on other engagements related to the audit of financial information, such as general purpose financial reports for entities of a different nature (for example, certain public sector entities) and the audit engagements described in ASA 800, and the illustrative reports are adapted as appropriate in the circumstances.