Auditing Standard ASA 315 Identifying and Assessing the Risks of Material Misstatement
Considerations for Understanding the EntConsiderations for Understanding the Entity and its Business Model
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Considerations for Understanding the Entity and its Business Model
This appendix explains the objectives and scope of the entity’s business model and provides examples of matters that the auditor may consider in understanding the activities of the entity that may be included in the business model. The auditor’s understanding of the entity’s business model, and how it is affected by its business strategy and business objectives, may assist the auditor in identifying business risks that may have an effect on the financial report. In addition, this may assist the auditor in identifying risks of material misstatement.