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CS Professional · Compliance Management, Audit and Due Diligence · Forming an Opinion and Reporting

Ganga Exports Ltd, an Indian company, prepares one set of financial statements under both the Accounting Standards prescribed under section 133 of the Companies Act, 2013 and IFRSs. The auditor finds the statements comply with the Accounting Standards but fail to comply with IFRSs in a material respect. What does SA 700 (Revised) indicate about the opinion?

Each framework is considered separately. Since the statements comply with the Accounting Standards but not IFRSs, the auditor can give an unmodified opinion on the Accounting Standards framework and a modified opinion on IFRSs in accordance with SA 705 (Revised).

  1. AAn unmodified opinion on the Accounting Standards framework, and a modified opinion on IFRSs under SA 705 (Revised)Correct
  2. BA single adverse opinion on both frameworks together
  3. CAn unmodified opinion on both frameworks because one framework is complied with
  4. DA modified opinion on the Accounting Standards framework, and an unmodified opinion on IFRSs

Explanation

Each framework is considered separately. Where the statements comply with one framework but not the other, an unmodified opinion can be given on the compliant framework (here, the Accounting Standards) and a modified opinion given on the other (IFRSs) in accordance with SA 705 (Revised). Treating both together or reversing them is incorrect.

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