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CA Final · Advanced Auditing, Assurance and Professional Ethics · Reporting

For Godavari Steels Ltd., the auditor wants to present statutory reporting that addresses the same topic as an SA-required report element, within the same section as that element. Which treatment is correct under SA 700 (Revised)?

Presenting them together is permitted when the topics are the same, but the report must clearly differentiate the other reporting responsibilities from the reporting required by the SAs. A separate section is not always mandatory, and no audit committee approval is required for layout.

  1. AIt is not permitted; it must always be in a separate section
  2. BIt is permitted, and the auditor's report must clearly differentiate the other reporting responsibilities from the reporting required by the SAsCorrect
  3. CIt is permitted without any need to differentiate, as both are equally mandatory
  4. DIt is permitted only if the audit committee approves the layout

Explanation

When other reporting responsibilities address the same topics as SA-required elements, they may be presented in the same section. Where this is done, the report must clearly differentiate them from the reporting required by the SAs. Separate-section-only is wrong because the same-topic exception exists.

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