Explain why it is important for auditors to communicate With those charged with governance
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The auditor should aim to develop a constructive working relationship with those charged with governance, whilst retaining his independence and objectivity, and under ISA (UK) 260, one of his objectives is to promote effective two-way communication with those charged with governance. The main purposes of such communication are: •to
assist the auditor and those charged with governance in understanding matters related to the audit. This includes communicating clearly the responsibilities of the auditor in relation to the audit and an overview of the planned timing and scope of the work; Need help? Get subscribed!To subscribe to this content, simply call 0800 231 5199 We can create a package that’s catered to your individual needs. Or book a demo to see this product in action. ISA 260 Communication with Those Charged with Governance provides guidance to auditors in relation to communicating with those charged with governance on matters arising from the audit of an entity’s financial statements. Required: (i) Explain why it is important that auditors communicate throughout the audit with those charged with governance; and (2 marks) (ii) Describe THREE examples of matters that the
auditors may communicate to those charged with 1638 others have taken this question When should the auditor communicate with those charged with governance?[4] If the entity includes other information in documents containing audited financial statements, the auditor should communicate with those charged with governance the auditor's responsibility with respect to such other information, any procedures performed relating to the other information, and the results.
Why is communication important for auditors?Establishing effective communication throughout the audit/review process. Effective communication helps to keep the auditee/reviewee informed about developments in the course of our work. It enhances efficiency, increases motivation, and leads to satisfaction in work done well.
What responsibility did the auditors have to discuss their concerns with those charged with governance?the auditor is responsible for forming and expressing an opinion about whether the financial statements that have been prepared by management, with the oversight of those charged with gover- nance, are prepared, in all material respects, in accordance with the applicable financial reporting framework.
What items should be included in the auditor's communication with those charged with governance?An auditor's communication with those charged with governance is required to include the: Discussion of disagreements with management about matters that significantly impact the entity's financial statements.
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