Advanced Auditing, Assurance and Professional Ethics · Reporting

SA 720 (Revised): Responsibilities Relating to Other Information

Updated 5 October 2026 · Fact-checked

Other information is financial or non-financial information, other than the financial statements and the auditor's report, included in an entity's annual report. Under SA 720 (Revised), you read it, compare it with the financial statements and your audit knowledge, and respond to any material inconsistency or misstatement. You then report on it in the Other Information section, where one is required.

Understand SA 720 (Revised): Responsibilities Relating to Other Information

Companies publish an annual report. It holds the audited financial statements, but also other material such as the Board's report, management discussion and analysis, and the chairman's statement. Readers see all of it together. If the other material contradicts the financial statements, trust in the audited numbers falls.

SA 720 (Revised) deals with this. Other information means financial or non-financial information (other than the financial statements and your auditor's report) included in the entity's annual report. The annual report is the document, or combination of documents, prepared for owners or similar stakeholders, containing the financial statements and your report.

Your duty is to read and consider. You do not audit the other information and you give no assurance on it. You read it to see if it is materially inconsistent with the financial statements, or with what you learned during the audit. While reading, stay alert to anything that looks materially misstated.

A material inconsistency arises when other information contradicts information in the financial statements, or conflicts with your audit knowledge. A material misstatement of other information exists when it is incorrectly stated or misleading, and it may mislead users.

If you find a material misstatement, you request management to correct it. If management agrees, you perform procedures to confirm the correction. If management refuses, you communicate the matter to those charged with governance and request that they correct it. If it is still uncorrected, you take appropriate action, which includes considering the implications for your report and may include obtaining legal advice.

Where your report includes an Other Information section, it must describe the uncorrected material misstatement. If the other information is received only after the report date, you take appropriate action, which may include considering the implications for your report. Withdrawal from the engagement is a separate possible action, available only where law or regulation permits it.

Your report must carry an Other Information section for a listed entity where you have obtained, or expect to obtain, other information. For other entities it is required where you have obtained some or all of the other information by the report date. If a non-listed entity's other information has not been obtained by the report date, the section may be omitted.

Key rules to remember

Definition of other information: Other information = financial and non-financial information in the annual report − (financial statements + auditor's report); Includes items like Board's report and management discussion. The auditor gives no assurance on it.
Core duty: Read and consider: compare with (a) financial statements and (b) audit knowledge; Two comparisons are required. Also stay alert for other signs of material misstatement.
Timing: Obtain the other information before the date of the auditor's report, as far as possible; Agree with management on when it will be available. If it is only available after the report date, you plan procedures for that situation.
Response to uncorrected misstatement: Request correction, then communicate with those charged with governance, then take appropriate action; If the misstatement stays uncorrected, you take appropriate action, which includes considering the effect on your report and may include obtaining legal advice. Where the report includes an Other Information section, it must describe the uncorrected material misstatement. If the other information is received after the report date, the appropriate action may include considering the implications for your report. Withdrawal from the engagement is a separate possible action where law or regulation permits it.
Reporting rule: Other Information section = identification + responsibility statement + no-opinion statement + result (nothing to report, or description of uncorrected misstatement); Required for a listed entity where you have obtained or expect to obtain other information. For other entities, required where you have obtained some or all of it by the report date.

How to solve SA 720 (Revised): Responsibilities Relating to Other Information questions

Use the same sequence for any SA 720 question, whether it is a case MCQ or a descriptive answer.

1Identify the document and the item. Check if it is in the annual report and is not the financial statements or your report. If yes, it is other information.
2Check timing. Was the other information available before the report date, or will it come later?
3State the duty. You read and consider it against the financial statements and your audit knowledge.
4Decide whether there is a material inconsistency or a material misstatement of fact. Use the facts given.
5If the problem is in the other information, ask management to correct it. If they correct it, you perform procedures to confirm the correction. If they refuse, communicate with those charged with governance.
6If still uncorrected, take appropriate action: consider the implications for your report and obtain legal advice if needed. Where the report includes an Other Information section, it must describe the uncorrected misstatement. Withdrawal is a separate possible action where law or regulation permits.
7If the problem is in the financial statements, consider the need to modify your opinion under SA 705.
8Conclude with the content of the Other Information section of your report, if one is required.

Quickest way: Four-question check for SA 720 cases

When to use it: Use it when you have limited time on a case-scenario MCQ or a short descriptive answer.

Is it in the annual report and outside the financial statements and report? Then it is other information.
Is it inconsistent with the financial statements or audit knowledge, or plainly misstated?
Which side is wrong: the financial statements or the other information? This decides the response.
Write the result: correction by management, else communication with governance, then report consequences.

Common mistakes in SA 720 (Revised): Responsibilities Relating to Other Information

Saying the auditor gives an opinion or assurance on other information.
Because the information sits in the same document as audited statements.
Fix: State that you only read and consider it. Your report says you do not express an opinion or any form of assurance conclusion on it.
Treating the financial statements as other information.
Students read 'information in the annual report' too broadly.
Fix: Remember the definition excludes the financial statements and your auditor's report.
Modifying the audit opinion whenever other information is wrong.
Confusing the opinion with the Other Information section.
Fix: A misstatement in other information does not by itself modify your opinion on the financial statements. It is described in the Other Information section. Only if the financial statements need correction do you consider SA 705.
Jumping to withdrawal or reporting before asking management.
Skipping the order of response.
Fix: Follow the order: discuss with management, request correction, inform those charged with governance, then decide on further action.
Ignoring other information that is received after the report date.
Students assume the duty ends once the report is signed.
Fix: Plan for it. If it is obtained after the report date, you still read it and respond if you find a material misstatement, and consider the effect on your report.
Leaving the Other Information section out for a listed company because there is 'nothing to report'.
Believing the section is needed only when problems exist.
Fix: For a listed entity the section is required where you have obtained, or expect to obtain, other information. It then states there is nothing to report if that is the position.

Worked examples

Example 1

You are auditing a listed company. The draft annual report you receive before signing says in the Board's report that 'revenue grew by 20%'. The audited financial statements show growth of 8%. Management says the Board's report is already printed and will not be changed. What are your responsibilities and the effect on your report?

Show the solution

The Board's report is in the annual report and is outside the financial statements and your report, so it is other information.
The 20% claim contradicts the 8% in the financial statements. This is a material inconsistency.
First decide which is wrong. The audited statements agree with your evidence, so the financial statements are correct and the other information is misstated.
Ask management to correct the Board's report. They refuse.
Communicate the matter to those charged with governance and request correction.
If it remains uncorrected, take appropriate action: consider the implications for your report and obtain legal advice if needed. Withdrawal is a separate possible action where law or regulation permits.
Your opinion on the financial statements is not modified because the financial statements are correct.
The entity is listed and you have obtained the other information, so your report includes an Other Information section. It must describe the uncorrected material misstatement.

Answer: This is a material inconsistency in other information. Request correction, then inform those charged with governance. If it stays uncorrected, the Other Information section, which is included here, must describe it. The opinion on the financial statements is not modified.

Example 2

For a private company, you have issued your report on 10 May. The directors' report is not ready on that date and you have obtained no other information by then. Management promises the directors' report in June. In June you read it and find it states that no related party transactions occurred. You know from the audit that material related party transactions exist. Management corrects it before the annual general meeting. What do you do?

Show the solution

The directors' report is other information. The company is not listed and you had obtained no other information by 10 May, so the report dated 10 May may omit the Other Information section.
The directors' report was obtained after the report date. You still read and consider it.
The statement conflicts with your audit knowledge, so it is a material misstatement of the other information.
Request management to correct it. Management agrees and corrects it.
Perform procedures to confirm that the correction has been made.
The matter is corrected, so there is no uncorrected misstatement to deal with.
If management had refused, you would communicate with those charged with governance and take appropriate action, which includes considering the effect on your report and obtaining legal advice.

Answer: For this non-listed company, the 10 May report may omit the Other Information section because no other information had been obtained by that date. You read the late directors' report, find a material misstatement against your audit knowledge, ask for correction, and perform procedures to confirm it is made. If management had refused, you would escalate to those charged with governance and take appropriate action, including considering the effect on your report and obtaining legal advice.

Exam tips

Case MCQs on SA 720 usually test one decision: is it other information, and what is the first response? Pick the answer that follows the order: management, then governance, then reporting.
In descriptive answers, write in provision, facts, conclusion form. Quote the definition, apply it to the item, then conclude.
Always state which side is wrong. Many answers lose marks by not separating errors in the financial statements from errors in other information.
Remember there is no assurance on other information. Use the phrase 'does not cover the other information' in your answer.
Link the topic to the Other Information section of the auditor's report in SA 700 (Revised). Examiners often combine the two.

Practice questions from Reporting

SA 720 (Revised): Responsibilities Relating to Other Information in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

CMA IntermediateSA 200 to SA 299: General Principles and Responsibilities

SA 720 (Revised): Responsibilities Relating to Other Information: frequently asked questions

What is other information under SA 720 with examples?

It is financial or non-financial information in the annual report, other than the financial statements and your auditor's report. Examples are the Board's report, management discussion and analysis, and the chairman's statement. You read it but give no assurance on it.

Do I have to audit the other information?

No. SA 720 requires you only to read and consider it against the financial statements and your audit knowledge. You do not express an opinion or any assurance conclusion on it.

Does a misstatement in other information change my audit opinion?

Not by itself. If the other information is misstated and management will not correct it, the Other Information section, where your report includes one, must describe the misstatement. You modify the opinion only if the financial statements themselves are misstated.

Is the Other Information section needed for every audit report?

For a listed entity it is required where you have obtained, or expect to obtain, other information, and it states there is nothing to report if that is the position. For other entities it is required where you have obtained some or all of the other information by the report date.