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The new standard does not require the communication of KAMs in the auditor’s report. The new standard addresses both the auditor’s judgment about what to communicate as well as the form and content of such communication. The purpose of communicating KAMs is to provide greater transparency about the audit to the financial statement’s external users. Section 701 addresses the auditor’s responsibility to communicate key audit matters (KAMs) in the auditor’s report if and when the auditor is engaged. It establishes a new auditing standard, AU-C Section 701, Communicating Key Audit Matters in the Independent Auditor’s Report (Section 701). The changes are intended to enhance the communicative value and relevance of the auditor’s report. 134 changes the form and content for all auditor’s reports under Generally Accepted Auditing Standards (GAAS). The following is a quick summary of what you need to know about these new SASs:
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Below is a table that includes a summary of the new SASs, topic, AU-C section affected, and issuance date: SAS NO.Īmendments to the Description of the Concept of MaterialityĪmendments to Incorporate Changes from SAS 134Īmendments to Incorporate Changes from SAS 134 and 137
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However, in this case, these new SASs require broader understanding because there are vital decisions for business leaders who issue financial statements that result from these SASs. Traditionally, new SASs aren’t something the general public needs to understand. The AICPA’s Auditing Standards Board has published new Statements on Auditing Standards (SASs): No.
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