Sa - 200 - Overall Objectives Of An Auditor And Conduct Of Audit In Accordance With Standards On Auditing

Scope of this SA:

·        It establishes the Independent Auditor’s overall responsibilities when conducting an audit in accordance with SAs

·        It sets out –

Ø  The objectives of the auditor and

Ø  The nature and scope of an audit designed to meet those objectives.

An audit of Financial Statements:

An Auditor is required to express an opinion on whether the Financial Statements are prepared, in all material respects, in accordance with an applicable Financial Reporting Framework.

The Management/TCWG are primarily responsible for preparation & presentation of Financial Statements.

Overall Objectives of an Auditor:-

·        An Auditor is required to obtain Reasonable Assurance that the FS are free from material misstatements, whether due to fraud or error.

·        An Auditor is required to report on FS and communicate as required by SAs in accordance with auditor’s findings.

Note:-

Ø  In cases where the reasonable assurance cannot be obtained, he may either disclaim his opinion or withdraw from his engagement, where withdrawl is legally permissible.

Ø  The auditor is required to maintain professional scepticism & exercise professional judgement throughout the conduct of audit.

Compliances:

·        The Auditor shall comply with all SAs relevant to the Audit. However, he shall not comply with a particular standard if –

Ø  the ENTIRE SA is not relevant  in the circumstances of the Audit.

Ø  the SA is conditional and the conditional does not exist in the current circumstances of Audit.

·        He shall not represent compliance with SA in his report unless he has complied with the requirements of the SAs.

Note:

Ø  Where the Auditor judges not to follow or depart from the requirements in an SA, based on the circumstances of Audit, he shall perform alternative audit procedures to achieve the overall aim of that SA.

Ø  If the objective in a relevant SA canot be achieved which prevents the auditor from achieving the overall objectives of the auditor (i.e., obtaining reasonable assurance and reporting on Financial Statements), he may either modify his opinion or withdraw from the engagement.