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

Orion Steels Ltd's financial statements comply with the Accounting Standards prescribed under section 133 of the Companies Act, 2013, but fail to comply with IFRSs, the other applicable framework. What does SA 700 (Revised) permit the auditor to do?

The auditor can give an unmodified opinion on the section 133 Accounting Standards framework and a modified opinion on IFRSs under SA 705 (Revised). Each framework is assessed separately, and non-compliance with one does not force modification of the other.

  1. AGive an unmodified opinion on the section 133 framework and a modified opinion under SA 705 (Revised) on IFRSsCorrect
  2. BGive an unmodified opinion on both frameworks with an Emphasis of Matter paragraph on IFRSs
  3. CGive a modified opinion on both frameworks because one failed
  4. DWithdraw the opinion on the section 133 framework and report only on IFRSs

Explanation

Where the statements comply with one framework but not the other, an unmodified opinion can be given on the framework complied with. A modified opinion is given for the other framework in accordance with SA 705 (Revised). An Emphasis of Matter paragraph cannot cure a non-compliance, and the failure on one framework does not require modifying the other.

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