Implications for the Auditor’s ReportImplications for the Auditor’s Report

Implications for the Auditor’s Report

Use of Going Concern Basis of Accounting Is Appropriate – No Material Uncertainty Exists

1. If the auditor concludes that the going concern basis of accounting is appropriate and no material uncertainty exists, the auditor shall include a separate section in the auditor's report with the heading “Going Concern", and: (Ref: Para. A78–A79)
   1. State that: (Ref: Para. A80–A81)
      1. In the context of the audit of the financial report as a whole, and in forming the auditor’s opinion thereon, the auditor concluded that management’s use of the going concern basis of accounting in the preparation of the financial report is appropriate;
      2. Based on the audit evidence obtained, the auditor has not identified a material uncertainty related to events or conditions that may cast significant doubt on the entity’s ability to continue as a going concern; and
      3. The auditor’s conclusions are based on the audit evidence obtained up to the date of the auditor’s report and are not a guarantee as to the entity’s ability to continue as a going concern.
   2. For an audit of financial report of a listed entity, when significant judgements are made by management in concluding that there is no material uncertainty related to events or conditions that may cast significant doubt on the entity’s ability to continue as a going concern: (Ref: Para. A82–A83, A89)
      1. Include a reference to the related disclosure(s) in the financial report, if any; and (Ref: Para. A73–A76)
      2. Describe how the auditor evaluated management’s assessment of the entity’s ability to continue as a going concern. (Ref: Para. A84–A88)

Use of Going Concern Basis of Accounting Is Appropriate – A Material Uncertainty Exists

Adequate Disclosure of a Material Uncertainty Is Made in the Financial Report

1. If adequate disclosure about the material uncertainty is made in the financial report, the auditor shall express an unmodified opinion and the auditor’s report shall include a separate section under the heading “Material Uncertainty Related to Going Concern” and: (Ref: Para. A78–A79, A90–A91)
   1. Include a reference to the related disclosure(s) in the financial report; (Ref: Para. A73, A77)
   2. For an audit of financial report of a listed entity, describe how the auditor evaluated management’s assessment of the entity’s ability to continue as a going concern; (Ref: Para. A84–A88)
   3. State that these events or conditions indicate that a material uncertainty exists that may cast significant doubt on the entity’s ability to continue as a going concern;