isa 540

in Feb 2008 IAASB issued a revised and redrafted ISA 540 Auditing accounting estimates, including fair value accounting estimates and related disclosures.

Requirements of ISA 540:

The auditor shall obtain an understanding of the following as part of the process of understanding the business:
– The requirements of the applicable financial reporting framework.
– The means by which the management identifies transaction, events and conditions that may give rise to the accounting estimates.
– How management makes….

for further details refer P7 Int BPP book page number 223.

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