Table A This sentence is overly complex and Evaluate procedures performed, conveys the sense of an overly passive role including the work of others, to address (e) (i) for the engagement partner. the risks of material misstatement in the financial statements in respect of We recommend rewording as follows: taxation, and to assess the effect of the (i) Evaluate procedures undertaken to results of procedures on other areas of address the risks of material misstatement an audit. in the financial statements in respect of taxation, including reviewing and evaluating the work of others. Assess the results of the procedures and the impact on other areas of the audit. A We recommend including an additional Business Law and Regulations learning outcome at the start of this (g) competence area: Assess the regulatory environment and consider which laws and regulations are relevant to the engagement and its financial statements. Table A We recommend rewording as: Evaluate the impact on the audit of a potential breach of law and regulations. (g) (i) Evaluate the impact on the financial statements being audited of a potential breach of law and regulations. A We believe that the term Evaluate the various sources of ‘available’ this area too broad. In addition the term financing available to an entity to (h) (i) testing and review procedures’ design the corresponding audit strategy ‘appropriate implies that it is a review rather than an and plan appropriate testing and review audit. procedures. We recommend rewording as: Evaluate the sources of financing used by an entity in order to design the corresponding audit strategy and plan appropriate analytical procedures.
Table A (e) (i) Evaluate procedures performed, including the work of others, to address the risks of material misstatement in the financial statements in respect of taxation, and to assess the effect of the results of procedures on other areas of an audit. This sentence is overly complex and conveys the sense of an overly passive role for the engagement partner. We recommend rewording as follows: (i) Evaluate procedures undertaken to address the risks of material misstatement in the financial statements in respect of taxation, including reviewing and evaluating the work of others. Assess the results of the procedures and the impact on other areas of the audit. A (g) Business Law and Regulations We recommend including an additional learning outcome at the start of this competence area: Assess the regulatory environment and consider which laws and regulations are relevant to the engagement and its financial statements. Table A (g) (i) Evaluate the impact on the audit of a potential breach of law and regulations. We recommend rewording as: Evaluate the impact on the financial statements being audited of a potential breach of law and regulations. A (h) (i) Evaluate the various sources of financing available to an entity to design the corresponding audit strategy and plan appropriate testing and review procedures. We believe that the term ‘available’ this area too broad. In addition the term ‘appropriate testing and review procedures’ implies that it is a review rather than an audit. We recommend rewording as: Evaluate the sources of financing used by an entity in order to design the corresponding audit strategy and plan appropriate analytical procedures.
DTTLCommentLetter-IES8RED-FINAL.docx