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21 Jun 24

Subsequent Events in Audit Engagements: Requirements, Considerations, and Auditor Responsibilities

Introduction In a 2008 report to the European Commission titled ‘Comparative Studying on the Application of the Standard on Events After the Balance Sheets Dates – IAS 10, in the audited financial statements of four New Member States of the EU’, the Public Oversight Accounting and Auditing of the Republic…

20 Jun 24

Supporting Small Enterprises: Understanding UAE’s Small Business Relief

Avinash Gupta and Uttam Patel
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In the dynamic landscape of corporate taxation, fostering an environment conducive to the growth of small businesses is crucial for economic vitality. Recognizing this, the United Arab Emirates (UAE) has introduced Small Business Relief provisions under Article 21 of the UAE Corporate Tax Law. Let’s delve into the key components…

06 Jun 24

Evaluation of Misstatement in Audit Engagement (Part vi)

Communication & Reporting to Those Charged with Governance a) Communication with Those Charged with Governance Communication with those charged with governance is an integral part of the audit process because it helps the auditors gain a better understanding of the client’s management assertions, assess fraud risk, and approach the audit. If the communication goes well, it can…

29 May 24

Evaluation of Misstatement in Audit Engagement (Part v)

Specific Requirements and Application of ISA 450 The term ‘Application’ is an important step of applying the specific requirement. This can be simplified as a decision making process. The auditors shall make the initial assessment using the knowledge is gathered including the preliminary understanding the internal control. If the aggregate…

19 May 24

Evaluation of Misstatement in Audit Engagement (Part iv)

Evaluating the Effect of Uncorrected Misstatements considers materiality concepts already outlined previously. In this context, we can infer that misstatements are considered material if they would affect decisions made by users on the basis of the financial statements. This might include a decision not to invest in the entity, to…

11 May 24

Evaluation of Misstatement in Audit Engagement (Part iii)

Correction of Misstatements The importance of correcting misstatements is another area where the literature is silent. The auditing literature implies that auditors should correct all misstatements. More specifically, SAS (AU 326.20) and AAS 13 (AUs 322.20) require the auditor to request management to adjust the financial statements for all identified…

07 May 24

Evaluation of Misstatement in Audit Engagement (Part ii)

Categories of Factual Misstatements It can be assumed that factual misstatements are straightforward to detect and evaluate, and that auditors are likely to evaluate them consistently. This is because the distinction between the audited information and the auditors’ understanding, which is needed to evaluate misstatements, only exists for objective data,…

05 May 24

Evaluation of Misstatement in Audit Engagement (Part i)

Introduction: Definitions and Objectives i. Objectives and Definitions Inherent misstatement is defined as a misstatement of an amount or disclosure that is not in accordance with the applicable financial reporting framework, created by the difference between the amount, classification, presentation, or disclosure of that amount or disclosure in the financial…

16 Apr 24

Internal Controls at the in Statutory Audit (Part ix)

Challenges and Limitations of Internal Controls in Statutory Audit/External Auditor Procedures The challenges and limitations are the obstacles that the internal control system faces. The main challenges and limitations are those that cause the auditor to rely on internal controls. If they are not able to do so, auditors will…

29 Mar 24

Internal Controls at the in Statutory Audit (Part viii)

Impact of Effective Internal Controls on Statutory Audit/External Auditor Procedures The work impact of effective internal controls on statutory audit and external auditor procedures is a limiting case of a much broader topic. It sheds a detailed light on the effects of internal controls in business and how different types…

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