Discussion regarding IAASB Invitation to Comment (ITC) on the auditor’s report

In general up to 1½ marks for each relevant discussion point:

– Relevant introduction, e.g. reference to the reasons for the ITC
– 1 mark for each correct suggestion from the ITC:
o Suggestion of auditor’s affirmation regarding use of going concern assumption
o Suggestion of description of material uncertainties regarding going concern 
o Positioning of the going concern statements within the auditor’s report
o Description of management responsibility regarding going concern
– Current audit report has insufficient information and is part of expectation gap
– Additional disclosures could add clarity and transparency
– Credibility of financial statements is enhanced
– May help to highlight the subjective nature of going concern assessment
– Drawbacks include the affirmation being perceived as a guarantee of financial health

Maximum marks 8