[AUD] Subsequent Event

Subsequent period: from BS date to audit report date(last day of fieldwork)

 

Subsequent period auditing procedures (PRIME)

Post BS date events
Rep letter
Inquiry unusual adjustments
Minutes
Examine the last interim FS

1) Read the latest interim statements

2) Discuss with mgt

   a. existence of contingent liabilities

   b. significant changes in shareholder's equity items and long-term debts

   c. unusual adjustments in the subsequent period

3) Read minutes of BOD and other committees

4) Obtain a lawyer's letter on

   a. litigation

   b. Impednig litigation, claims

   c. contingent liabilities

5)  Representation letter

 

Subsequent discovery of facts existing at the date of the auditor's report

info is reliable, exist before audit report date

▽ yes

Audit report affected person relying on the report

▽ yes

effect on FS & auditors report determined

▽ yes

FS should be reissued /revised > how to address the matter in FS                                                    > if mgt refuses > notify BOD, person rely on the FS

 

Examples of Subsequent events

AR write-off, customer bankruptcy
review of post-balance transaction
make an inquiry, any unusual adj Jan-Feb
review minutes Jan
Examine the latest interim FS

 

 

Inquire about the current status of transactions that were recorded on the basis of preliminary data