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Withdrawal From The Engagement: The Auditor's Consideration of Compliance With Laws and Regulations

The auditor has identified noncompliance by the entity with laws and regulations that has a material effect on the financial statements. The auditor must consider withdrawal from the engagement, qualifying or issuing an adverse opinion on the financial statements, or qualifying the opinion or issuing a disclaimer if evidence cannot be obtained. The auditor may also need to report the noncompliance to management, those charged with governance, regulatory authorities, or other third parties.

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Shimena Mae Sabandal
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102 views

Withdrawal From The Engagement: The Auditor's Consideration of Compliance With Laws and Regulations

The auditor has identified noncompliance by the entity with laws and regulations that has a material effect on the financial statements. The auditor must consider withdrawal from the engagement, qualifying or issuing an adverse opinion on the financial statements, or qualifying the opinion or issuing a disclaimer if evidence cannot be obtained. The auditor may also need to report the noncompliance to management, those charged with governance, regulatory authorities, or other third parties.

Uploaded by

Shimena Mae Sabandal
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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1.

To the BOD and senior management


2. To the next higher level of authority e.g
audit committee, supervisory board (when
To Management
 When the entity does not take 1. Is believed to be involved)
the remedial action that the
auditor considers necessary in Withdrawal from
Qualified or Adverse Opinion-
the circumstances the Engagement noncompliance has material effect and
To the Usrs of the
 On receipt of an inquiry from The Auditor’s Consideration has not been properly reflected on FS
of Compliance with Laws Report on on FS
the proposed auditor, the Qualified opinion or disclaimer- auditor
existing auditor should advice and Regulations precluded by entity form obtaining
whether there are any sufficient evidence
professional reasons why the
proposed auditor should not
accept the appointment To the The auditor may need
Regulatory to seek legal advice in
Report on Noncompliance and such circumstances,
Enforcemnt giving due
consideration to the
Authorities
auditor’s responsibility
to the public interest

PSA  Ensure that entity’s operations are conducted


in accordance with laws and regulations;
prevention and detection of noncompliance

250  Policies and procedures, among others, that


may assist managers in:
o Monitoring legal requirements
o Instituting and operating appropriate
Responsibility of
Management for Compliance systems of control
with Laws and Regulations o Developing, publicizing and following
Code of Conduct
o Monitoring compliance and discipline
with the Code of Conduct
o Engaging legal advisers to assist in
monitoring legal requirements
o Maintain and comply a register of
significant law

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