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Hi sir,
In past year 2011 dec question 5, the answer suggested that other matter paragraph should be included in the audit report because there is an inconsistency in the chairman statement but I don’t quite understand where did the inconsistency come from?? Could you please explain please?
Thank you 🙂
Without looking at the question (!) I imagine the chairman has stated something in the chair’s report which is inconsistent with some matter within the financial statements.
An example would be where the financial statements record revenue at, say, $2m but the chair has referred to the revenue as exceeding $2.3m – because the chair has included sales tax in his figure.
The auditor is happy that the correct figure without the tax is $2m and the chair’s figure is therefore inconsistent and should be reported as an “other matter”
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