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ISA (UK) 700 requires the auditor to report by exception in the auditors’ reports
of companies disclosing compliance with the UK Corporate Governance Code
Dear sir..can u please tell me what does “report by exception” mean?
This isn’t examinable in AA because there is only one AA exam based on the international ISAs.
To report “by exception” means just that – the auditor would be silent on matters that have been adequately disclosed in compliance with the code – but draw attention to omissions (for example). This would fall under other reporting responsibilities and so not affect the audit opinion, key audit matters, etc (because it’s not disclosure in the financial statements and it does not fall within the scope of the audit of financial statements).