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Refers to this technical article :https://www.accaglobal.com/gb/en/student/exam-support-resources/professional-exams-study-resources/p7/technical-articles/completing-the-audit.html
“When misstatements remain uncorrected by management, the auditor is required to reassess the level of materiality to confirm that it remains appropriate, and should then determine if the uncorrected misstatements are material individually or in aggregate. The uncorrected misstatements must be communicated to those charged with governance, and the potential implications for the auditor’s report must also be communicated.”
1. The uncorrected misstatement must be communicated to TCWG whether its material or immaterial individually or in aggregate,or only the material individually or in aggregate should be communicated to?
“When the analytical procedures performed near the end of the audit reveal further previously unrecognised risk of material misstatement, the auditor is required to revise the previously assessed risk of material misstatement and modify the planned audit procedures accordingly. ”
2. Should we also revised the materiality level if the further previous unrecognised risk of material misstatement discover?
1. ISA 450 para 12 goes on to says “The auditor’s communication shall identify material uncorrected misstatements individually.” My interpretation then is that the auditor would not waste the time of TCWG on matters that are immaterial.
2. Risk/materiality are inextricably interrelated – if RoMM is increased, more audit work is needed so monetary materiality levels must be reduced to achieve this.
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