Auditing Standard ASA 2018-1 Amendments to Australian Auditing Standards
Amendments to ASA 200Amendments to ASA 200
Start here
Get a plain-English read of Amendments to ASA 200
Turn the raw legal text into a practical explanation grounded in Auditing Standard ASA 2018-1 Amendments to Australian Auditing Standards.
Amendments to ASA 200
- Existing paragraph A42 is amended (including the insertion of new footnotes 19 and 20) to read follows:
The assessment of the risks of material misstatement may be expressed in quantitative terms, such as in percentages, or in non‑quantitative terms. In any case, the need for the auditor to make appropriate risk assessments is more important than the different approaches by which they may be made. The Australian Auditing Standards do not ordinarily refer to inherent risk and control risk separately, but rather to a combined assessment of the “risks of material misstatement.” However, ASA 54019 requires a separate assessment of inherent risk and control risk to provide a basis for designing and performing further audit procedures to respond to the assessed risks of material misstatement, including significant risks, for accounting estimates at the assertion level in accordance with ASA 330.20 In identifying and assessing risks of material misstatement for significant classes of transactions, account balances or disclosures other than accounting estimates, the auditor may make separate or combined assessments of inherent and control risk depending on preferred audit techniques or methodologies and practical considerations. The assessment of the risks of material misstatement may be expressed in quantitative terms, such as in percentages, or in non‑quantitative terms. In any case, the need for the auditor to make appropriate risk assessments is more important than the different approaches by which they may be made.
19 See ASA 540 Auditing Accounting Estimates and Disclosures, paragraph 16.
20 See ASA 330, paragraph 7(b).
- As a result of the insertion of footnotes 19 and 20, subsequent footnotes of the Auditing Standard are re‑numbered and references to these footnotes are updated accordingly.
- Existing footnote * in paragraph A50 is amended to read as follows:
Issued by the Australian Accounting Standards Board, (July 2004) (June 2014).
- Existing footnote * in paragraph A64 of this Auditing Standard is amended to read as follows:
Issued by the Auditing and Assurance Standards Board (October 2009) (September 2018).