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D07954 1 (2014-07-17)

handle is hein.gao/gaobadqkz0001 and id is 1 raw text is: GAO U.S. GOVERNMENT ACCOUNTABILITY OFFICE 441 G St. N.W. Washington, DC 20548 July 17, 2014 Technical Director International Auditing and Assurance Standards Board 545 Fifth Avenue, 14th Floor New York, New York 10017 Subject: International Auditing and Assurance Standards Board April 2014 Exposure Draft, Proposed International Standard on Auditing (ISA) 720 (Revised), The Auditor's Responsibilities Relating to Other Information and Proposed Consequential and Conforming Amendments to Other ISAs This letter provides the U.S. Government Accountability Office's (GAO) comments on the International Auditing and Assurance Standards Board's (IAASB) revised exposure draft on the auditor's responsibilities relating to other information. We welcome the enhancements made to the November 2012 exposure draft, including those that addressed certain issues relating to GAO's comments raised in our March 14, 2013, letter. However, we would like the IAASB to further consider the points outlined in our comments below. GAO's comments on the specific matters requested by the board follow the General Comments section. General Comments Other Information Obtained Prior to the Date of the Auditor's Report Since the proposed standard would require reporting only when the other information is received prior to the date of the auditor's report, inconsistencies may develop in reporting on other information, potentially resulting in less clarity to the multiple stakeholders. The reporting requirement in the proposed paragraph 21 is applicable: When the auditor has obtained the final version of all or part of the other information prior to the date of the auditor's report. Paragraph A47 indicates that When the auditor has not obtained the final version of the other information prior to the date of the auditor's report, this ISA does not require the auditor to include a section in the auditor's report addressing other information. As in practice it is common to receive final other information around, but not necessarily before, the audit report date, the proposed standard may result in audit reports with no mention of the auditor's responsibilities relating to other information because of the timing of receipt of other information. Users may see some audit reports with a section describing the auditor's responsibilities as to other information, and at the same time see other audit reports, consistent with paragraph A47, with no mention of the auditor's responsibilities relating to other information. The proposed reporting, which would be required in some cases and discretionary in others, would not appear to address adequately the IAASB's goal of greater clarity and enhanced consistency around the world regarding the auditor's responsibilities relating to other information. Page 1

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