SA 580-“Written Representation”. PDF

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Summary

SA 580-“Written Representation”.

Indian standards of auditing....

Description

Standards on Auditing

Summary Notes

SA 580 “Written Representation” It is a written statement provided to the auditor to confirm matters or to support other audit evidence. Scope of this SA Auditor’s Responsibility to obtain written representations from management or TCWG in the form of representation letter addressed to the auditor. Page 17

Standards on Auditing

Summary Notes

Written Representations as audit evidence Written representations are audit evidence but they do not provide sufficient & appropriate audit evidence on their own. It only supports other Audit Evidence. It does not dilute auditor’s responsibility to obtain other audit evidence for matters covered by written representations.

Written Representations about management’s Responsibilities •

For the preparation & presentation of Financial statements as per FRF (e.g. proper accounting estimates, accounting policies and consistency in applying etc)

•

To provide information to auditor as per agreed terms of audit engagement.

Doubts as to the Reliability of WR  The auditor has concern about the competence, integrity, ethical values of management and determines their effects on reliability of representation.  If WR are inconsistent with other audit evidence, the auditor shall perform audit procedures to attempt to resolve the matter.  If the auditor conclude that the WR are not reliable, the auditor shall take appropriate actions, including determining the possible effect on opinion. Management’s refusal to provide WR     

If management refuses/ do not provide the requested WR-analysis it is an indicator of fraud. Re evaluates the integrity of management + Doubt the earlier WR given by them. Discuss with the mgt, why they are not willing to give WR . Go for alterative audit procedures to obtain audit evidence for the matters given in WR If not possible –Disclaim the Audit Opinion

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