ACCA Strategic Professional · Advanced Audit and Assurance (International) · Subsequent events and going concern
Orchard Retail Ltd has a 30 June 20X6 year-end. The auditor's report is dated 20 September 20X6. When planning completion, the audit senior suggests the following procedure to identify subsequent events up to the report date. Which of the following procedures is NOT a required type of procedure under ISA 560 for this purpose?
A full re-audit of all material year-end balances using post year-end evidence is not required by ISA 560. The standard requires targeted procedures such as inquiry of management, reading minutes after the period end, and reviewing the latest interim financial information, to identify events needing adjustment or disclosure.
- AReading minutes of meetings of owners, management and those charged with governance held after the period end
- BInquiring of management whether any subsequent events have occurred that might affect the financial statements
- CReading the entity's latest available interim financial statements and budgets, if any
- DPerforming a full re-audit of year-end balances using post year-end evidence for all material accountsCorrect
Explanation
ISA 560 requires procedures to be designed to identify events requiring adjustment or disclosure, such as understanding management's procedures, inquiry, reading minutes and reviewing latest interim information. It does not require a full re-audit of all year-end balances. The first three options are all named in the standard; the fourth goes beyond what is required.
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