What is Subsequent events procedures?
In short
The auditor performs procedures covering the period from the financial statement date to the audit report date to identify events that require adjustment of, or disclosure in, the financial statements.
Key takeaways
- Procedures include reading minutes and the latest interim statements, inquiring of management and obtaining the lawyer's letter and written representations.
- Events giving more evidence about conditions at the balance sheet date require adjustment; new conditions require disclosure.
- Facts found after the report date may lead to dual dating.
Where it's tested
AUD: Written Representations & Completing the Audit — study notes, a five-minute revision sheet and practice questions.
Practise: 3 questions
Question 1 of 3 · 0 answered
A material subsequent event requiring adjustment is discovered after the original report date but before issuance, and the auditor extends procedures only for that event. The auditor should: