Auditing Standard ASA 2020-1 Amendments to Australian Auditing Standards
Amendments to ASA 210Amendments to ASA 210
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Amendments to ASA 210
- Existing footnote 14 in paragraph A16 is amended to read as follows:
See ASA 315 Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment, Appendix 3 paragraph 22paragraph A54.
- Existing paragraph A18 is amended to read as follows:
It is for management to determine what internal control is necessary to enable the preparation of the financial report. The term “internal control” encompasses a wide range of activities within components of the system of internal control that may be described as the control environment; the entity’s risk assessment process; the entity’s process to monitor the system of internal control, the information system, including the related business processes relevant to financial reporting, and communication; and control activities; and monitoring of controls. This division, however, does not necessarily reflect how a particular entity may design, implement and maintain its internal control, or how it may classify any particular component.[15] An entity’s internal control (in particular, its accounting books and records, or accounting systems) will reflect the needs of management, the complexity of the business, the nature of the risks to which the entity is subject, and relevant laws or regulation.