What is Audit of a single statement or specific element?
In short
An auditor can be engaged to audit a single financial statement, such as a balance sheet, or a specific element, account or item, such as a schedule of royalties, and report on it.
Key takeaways
- Materiality is set for the element itself, which usually means more detailed work.
- Interrelated accounts may need to be audited too.
- If an adverse opinion or disclaimer is given on the full statements, a report on an element of them is restricted.
Where it's tested
AUD: Audit Reports — study notes, a five-minute revision sheet and practice questions.
Practise: 3 questions
Question 1 of 3 · 0 answered
An auditor is unable to observe the physical inventory count or satisfy themselves through alternative procedures, and inventory represents 60% of total assets. What opinion is appropriate?