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Hi,
Chapter 5 practice question 6 says which of the following is NOT found in an unqualified audit report:
A statement the audit provides only reasonable assurance
Details about materiality levels
A statement the audit has been conducted in line with IAS
An explanation of managements responsibilities
The correct answer is details about materiality levels, although this can actually be included in the audit report as it is included in Tesco’s 2014 independent auditors report on page 65, have they included something that they shouldn’t or is the question wrong?
Steve
Interesting. I also checked the 2014 FS of Smith and Nephew who were audited by Ernst and Young and it is similar. Both that audit report and Tesco’s also contain a lot of detail on risk areas and the auditor’s response.
ISA 700 (https://www.frc.org.uk/Our-Work/Publications/Audit-and-Assurance-Team/ISA-700-%28UK-and-Ireland%29-700-%28Revised%29-File.pdf) para 19A and 19B now require this information to be included in the audit report of companies that report on the application of the UK corporate governance code. However, the IFAC ISA 700, ie the international version, does not require these details.
Your F8 exam, as there is now only one version will stay clear of this problem, but we should perhaps change the MCQ to avoid confusion.
Thanks.
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