Auditing Standard ASA 315 Identifying and Assessing the Risks of Material Misstatement
Risk Assessment Procedures and Related ARisk Assessment Procedures and Related Activities
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Risk Assessment Procedures and Related Activities
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The auditor shall design and perform risk assessment procedures to obtain audit evidence that provides an appropriate basis for: (Ref: Para. A11–A18)
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The identification and assessment of risks of material misstatement, whether due to fraud or error, at the financial report and assertion levels; and
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The design of further audit procedures in accordance with ASA 330.
The auditor shall design and perform risk assessment procedures in a manner that is not biased towards obtaining audit evidence that may be corroborative or towards excluding audit evidence that may be contradictory. (Ref: Para. A14)
- The risk assessment procedures shall include the following: (Ref: Para. A19–A21)
(a) Enquiries of management and of other appropriate individuals within the entity, including individuals within the internal audit function (if the function exists). (Ref: Para. A22–A26)
(b) Analytical procedures. (Ref: Para. A27–A31)
(c) Observation and inspection. (Ref: Para. A32–A36)
Information from Other Sources
- In obtaining audit evidence in accordance with paragraph 13, the auditor shall consider information from: (Ref: Para. A37‒A38)
(a) The auditor’s procedures regarding acceptance or continuance of the client relationship or the audit engagement; and
(b) When applicable, other engagements performed by the engagement partner for the entity.
- When the auditor intends to use information obtained from the auditor’s previous experience with the entity and from audit procedures performed in previous audits, the auditor shall evaluate whether such information remains relevant and reliable as audit evidence for the current audit. (Ref: Para. A39‒A41)
Engagement Team Discussion
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The engagement partner and other key engagement team members shall discuss the application of the applicable financial reporting framework and the susceptibility of the entity’s financial report to material misstatement. (Ref: Para. A42–A47)
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When there are engagement team members not involved in the engagement team discussion, the engagement partner shall determine which matters are to be communicated to those members.