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Dear Sir,
I have read the ISA as well as some technical articles for purpose of distinguishing 3 kind of paragraphs. However, I am still confuse with them as I noted that all of them are necessary to draw user’s attention to a matter presented or disclosed in FS, based on auditor’s professional judgment.
Sir, could you please help us distinguish them clearly? Is there any case in which 3 of them happened on audit report?
Many thanks for your support.
Let’s look at Bukenya’s post first (and this is why students should refrain from answering questions that are specifically addressed to the tutor!)
“The new emphasis of matters paragraph public should not talk about issues to do with going concern .that should be included in the MURg in the kam section.its should talk of other fundamental issues other than going concern”
“The new emphasis of matters paragraph public should not talk about issues to do with going concern”
Agreed
“that should be included in the MURg in the kam section”
Disagreed – Where there are material uncertainties re going concern, these uncertainties are the subject of a separate paragraph and are NOT included within the KAM paragraphs
“its should talk of other fundamental issues other than going concern”
Agreed / but also disagreed!
It IS possible to have matters that are significant for the better understanding by the reader of the financial statements but it’s equally possible that these matters were NOT sufficiently significant for the auditor to include them as Key Audit Matters
As for positioning, I too am slightly confused by the standard 🙁
The KAM paragraphs should be shortly after the basis of opinion
But so also should any emphasis of matter paragraphs be shortly after the basis of opinion
The standard is not prescriptive on these positionings … personally I would have them as follows:
Opinion
Basis of opinion
Details of any matters that have led to the auditor qualifying the audit opinion
Management’s responsibilities
Auditors’ responsibilitiesThen KAMs
Material uncertainty re going concern
Emphases of matter
Other matters“Is there any case in which 3 of them happened on audit report?”
I can think of no reason to suggest that it would not be possible to have all three in there
Does that help?
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