Sa 700 PDF

SA 700(Revised)*
Forming an Opinion and Reporting on

Financial Statements
(Effective for audits of financial statements for periods
beginning on or after April 1, 2018)
Contents
Paragraph(s)
Introduction
Scope of this SA.................................................................................... 1−4
Effective Date ............................................................................................ 5
Objectives ................................................................................................ 6
Definitions ........................................................................................... 7–9
Requirements
Forming an Opinion on the Financial Statements ............................. 10−15
Form of Opinion ............................................................................... 16−19
Auditor’s Report ............................................................................... 20− 51
Supplementary Information Presented with the Financial
Statements ........................................................................................ 52-53
Application and Other Explanatory Material
Qualitative Aspects of the Entity’s Accounting Practices ................ A1−A3
Disclosures of the Effect of Material Transactions and Events
on the Information Conveyed in the Financial Statements ................... A4
Description of the Applicable Financial Reporting Framework ..... A5−A10
Form of Opinion .......................................................................... A11−A12
Auditor’s Report ........................................................................... A13−A69
Supplementary Information Presented with the Financial
Statements ................................................................................... A70-A76
Appendix: Illustrations of Independent Auditor’s Reports on Financial
Statements
* Issued in May 2016.

Handbook of Auditing Pronouncements-I.A
Standard on Auditing (SA) 700(Revised), “Forming an Opinion and

Reporting on Financial Statements”, should be read in the context of
the “Preface to the Standards on Quality Control, Auditing, Review,
Other Assurance and Related Services”, which sets out the authority of
SAs and SA 200, “Overall Objectives of the Independent Auditor and
the Conduct of an Audit in Accordance with Standards on Auditing”.
819 SA 700(Revised)
Introduction
Scope of this SA
1. This Standard on Auditing (SA) deals with the auditor’s responsibility to
form an opinion on the financial statements. It also deals with the form and
content of the auditor’s report issued as a result of an audit of financial
statements.
2. SA 7011 deals with the auditor’s responsibility to communicate key audit
matters in the auditor’s report. SA 7052 (Revised) and SA 7063 (Revised) deal
with how the form and content of the auditor’s report are affected when the
auditor expresses a modified opinion or includes an Emphasis of Matter
paragraph or an Other Matter paragraph in the auditor’s report. Other SAs also
contain reporting requirements that are applicable when issuing an auditor’s
report.
3. This SA applies to an audit of a complete set of general purpose financial
statements and is written in that context. SA 8004 deals with special
considerations when financial statements are prepared in accordance with a
special purpose framework. SA 8055 deals with special considerations relevant
to an audit of a single financial statement or of a specific element, account or
item of a financial statement. This SA also applies to audits for which SA 800 or
SA 805 apply.
4. The requirements of this SA are aimed at addressing an appropriate
balance between the need for consistency and comparability in auditor reporting
globally and the need to increase the value of auditor reporting by making the
information provided in the auditor’s report more relevant to users. This SA
promotes consistency in the auditor’s report, but recognizes the need for
flexibility to accommodate particular circumstances of individual jurisdictions.
Consistency in the auditor’s report, when the audit has been conducted in
accordance with SAs, promotes credibility in the global marketplace by making
more readily identifiable those audits that have been conducted in accordance
with globally recognized standards. It also helps to promote the user’s
understanding and to identify unusual circumstances when they occur.
1
SA 701, Communicating Key Audit Matters in the Independent Auditor’s Report.
2
SA 705(Revised), Modifications to the Opinion in the Independent Auditor’s Report.
3
SA 706(Revised), Emphasis of Matter Paragraphs and Other Matter Paragraphs in the
Independent Auditor’s Report.
4
SA 800, Special Considerations—Audits of Financial Statements Prepared in Accordance with
Special Purpose Frameworks.
5
SA 805, Special Considerations—Audits of Single Financial Statements and Specific Elements,
Accounts or Items of a Financial Statement.
SA 700(Revised) 820
Effective Date
5. This SA is effective for audits of financial statements for periods beginning
on or after April 1, 2018.
Objectives
6. The objectives of the auditor are:
(a) To form an opinion on the financial statements based on an evaluation of
the conclusions drawn from the audit evidence obtained; and
(b) To express clearly that opinion through a written report.
Definitions
7. For purposes of the SAs, the following terms have the meanings attributed
below:
(a) General purpose financial statements – Financial statements prepared in
accordance with a general purpose framework.
(b) General purpose framework – A financial reporting framework designed to
meet the common financial information needs of a wide range of users. The
financial reporting framework may be a fair presentation framework or a
compliance framework.
The term “fair presentation framework” is used to refer to a financial
reporting framework that requires compliance with the requirements of the
framework and:
(i) Acknowledges explicitly or implicitly that, to achieve fair presentation
of the financial statements, it may be necessary for management to
provide disclosures beyond those specifically required by the
framework; or
(ii) Acknowledges explicitly that it may be necessary for management to
depart from a requirement of the framework to achieve fair
presentation of the financial statements. Such departures are
expected to be necessary only in extremely rare circumstances.
The term “compliance framework” is used to refer to a financial reporting
framework that requires compliance with the requirements of the
framework, but does not contain the acknowledgements in (i) or (ii) above.6
(c) Unmodified opinion – The opinion expressed by the auditor when the
auditor concludes that the financial statements are prepared, in all material
6
SA 200, paragraph 13(a).
821 SA 700(Revised)
respects, in accordance with the applicable financial reporting framework.7

8. Reference to “financial statements” in this SA means “a complete set of
general purpose financial statements, including the related notes.” The related
notes ordinarily comprise a summary of significant accounting policies and other
explanatory information and any other information required to be included as part
of the financial statements by the laws and regulations governing the entity. The
requirements of the applicable financial reporting framework determine the form
and content of the financial statements, and what constitutes a complete set of
financial statements.
9. Reference to “Accounting Standards” in this SA includes:
 The Accounting Standards issued by the Institute of Chartered Accountants
8
of India (ICAI) ; or
 The Standards of Accounting notified by the Central Government in
pursuance of section 133 of the Companies Act, 2013 and the Rules
thereunder; or
 The International Financial Reporting Standards (IFRSs); or
 The International Public Sector Accounting Standards (IPSASs) issued by
the International Public Sector Accounting Standards Board;
as may be applicable to the entity.
Requirements
Forming an Opinion on the Financial Statements
10. The auditor shall form an opinion on whether the financial statements are
prepared, in all material respects, in accordance with the applicable financial
reporting framework.9&10
11. In order to form that opinion, the auditor shall conclude as to whether the
auditor has obtained reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to fraud
or error. That conclusion shall take into account:
(a) The auditor’s conclusion, in accordance with SA 330, whether sufficient
7
Paragraphs 25–26 deal with the phrases used to express this opinion in the case of a fair
presentation framework and a compliance framework respectively.
8
For example, the Accounting Standards for Local Bodies issued by ICAI.
9
SA 200, paragraph 11.
10
Paragraphs 25–26 deal with the phrases used to express this opinion in the case of a fair
presentation framework and a compliance framework respectively.
SA 700(Revised) 822
appropriate audit evidence has been obtained;11

(b) The auditor’s conclusion, in accordance with SA 450, whether uncorrected
misstatements are material, individually or in aggregate;12 and
(c) The evaluations required by paragraphs 12–15.
12. The auditor shall evaluate whether the financial statements are prepared,
in all material respects, in accordance with the requirements of the applicable
financial reporting framework. This evaluation shall include consideration of the
qualitative aspects of the entity’s accounting practices, including indicators of
possible bias in management’s judgments. (Ref: Para. A1–A3)
13. In particular, the auditor shall evaluate whether, in view of the
requirements of the applicable financial reporting framework:
(a) The financial statements adequately disclose the significant accounting
policies selected and applied;
(b) The accounting policies selected and applied are consistent with the
applicable financial reporting framework and are appropriate;
(c) The accounting estimates made by management are reasonable;
(d) The information presented in the financial statements is relevant, reliable,
comparable, and understandable;
(e) The financial statements provide adequate disclosures to enable the
intended users to understand the effect of material transactions and events
on the information conveyed in the financial statements; and (Ref: Para.
A4)
(f) The terminology used in the financial statements, including the title of each
financial statement, is appropriate.
14. When the financial statements are prepared in accordance with a fair
presentation framework, the evaluation required by paragraphs 12–13 shall also
include whether the financial statements achieve fair presentation. The auditor’s
evaluation as to whether the financial statements achieve fair presentation shall
include consideration of:
(a) The overall presentation, structure and content of the financial statements;
and
(b) Whether the financial statements, including the related notes, represent the
11
SA 330, The Auditor’s Responses to Assessed Risks, paragraph 26.
12
SA 450, Evaluation of Misstatements Identified during the Audit, paragraph 11.
823 SA 700(Revised)
underlying transactions and events in a manner that achieves fair

presentation.
15. The auditor shall evaluate whether the financial statements adequately
refer to or describe the applicable financial reporting framework. (Ref: Para. A5–
A10)
Form of Opinion
16. The auditor shall express an unmodified opinion when the auditor
concludes that the financial statements are prepared, in all material respects, in
accordance with the applicable financial reporting framework.
17. If the auditor:
(a) concludes that, based on the audit evidence obtained, the financial
statements as a whole are not free from material misstatement; or
(b) is unable to obtain sufficient appropriate audit evidence to conclude that the
financial statements as a whole are free from material misstatement,
the auditor shall modify the opinion in the auditor’s report in accordance with SA
705 (Revised).
18. If financial statements prepared in accordance with the requirements of a
fair presentation framework do not achieve fair presentation, the auditor shall
discuss the matter with management and, depending on the requirements of the
applicable financial reporting framework and how the matter is resolved, shall
determine whether it is necessary to modify the opinion in the auditor’s report in
accordance with SA 705 (Revised). (Ref: Para. A11)
19. When the financial statements are prepared in accordance with a
compliance framework, the auditor is not required to evaluate whether the
financial statements achieve fair presentation. However, if in extremely rare
circumstances the auditor concludes that such financial statements are
misleading, the auditor shall discuss the matter with management and,
depending on how it is resolved, shall determine whether, and how, to
communicate it in the auditor’s report. (Ref: Para. A12)
Auditor’s Report
20. The auditor’s report shall be in writing. (Ref: Para. A13–A14)
Auditor’s Report for Audits Conducted in Accordance with Standards on
Auditing
Title
21. The auditor’s report shall have a title that clearly indicates that it is the
SA 700(Revised) 824
report of an independent auditor. (Ref: Para. A15)

Addressee
22. The auditor’s report shall be addressed, as appropriate, based on the
circumstances of the engagement. (Ref: Para. A16)
Auditor’s Opinion
23. The first section of the auditor’s report shall include the auditor’s opinion,
and shall have the heading “Opinion.”
24. The Opinion section of the auditor’s report shall also:
(a) Identify the entity whose financial statements have been audited;
(b) State that the financial statements have been audited;
(c) Identify the title of each statement comprising the financial statements;
(d) Refer to the notes, including the summary of significant accounting policies;
and
(e) Specify the date of, or period covered by, each financial statement
comprising the financial statements. (Ref: Para. A17–A18)
25. When expressing an unmodified opinion on financial statements prepared
in accordance with a fair presentation framework, the auditor’s opinion shall,
unless otherwise required by law or regulation, use one of the following phrases,
which are regarded as being equivalent:
(a) In our opinion, the accompanying financial statements present fairly, in all
material respects, […] in accordance with [the applicable financial reporting
framework]; or
(b) In our opinion, the accompanying financial statements give a true and fair
view of […] in accordance with [the applicable financial reporting
framework]. (Ref: Para. A19–A26)
26. When expressing an unmodified opinion on financial statements prepared
in accordance with a compliance framework, the auditor’s opinion shall be that
the accompanying financial statements are prepared, in all material respects, in
accordance with [the applicable financial reporting framework]. (Ref: Para. A21–
A26)
27. If the reference to the applicable financial reporting framework in the
auditor’s opinion is not to Accounting Standards referred to in paragraph 9, the
auditor’s opinion shall identify the origin of such other framework.
Basis for Opinion
825 SA 700(Revised)
28. The auditor’s report shall include a section, directly following the Opinion
section, with the heading “Basis for Opinion”, that: (Ref: Para. A27)
(a) States that the audit was conducted in accordance with Standards on
Auditing; (Ref: Para. A28)
(b) Refers to the section of the auditor’s report that describes the auditor’s
responsibilities under the SAs;
(c) Includes a statement that the auditor is independent of the entity in
accordance with the relevant ethical requirements relating to the audit, and
has fulfilled the auditor’s other ethical responsibilities in accordance with
these requirements. The statement shall refer to the Code of Ethics issued
by ICAI; (Ref: Para. A29–A34)
(d) States whether the auditor believes that the audit evidence the auditor has
obtained is sufficient and appropriate to provide a basis for the auditor’s
opinion.
Going Concern
29. Where applicable, the auditor shall report in accordance with SA 570
13
(Revised).
Key Audit Matters
30. For audits of complete sets of general purpose financial statements of
listed entities, the auditor shall communicate key audit matters in the auditor’s
report in accordance with SA 701.
31. When the auditor is otherwise required by law or regulation or decides to
communicate key audit matters in the auditor’s report, the auditor shall do so in
accordance with SA 701. (Ref: Para. A35–A38)
Other Information
32. Where applicable, the auditor shall report in accordance with SA 720
(Revised)14.
Responsibilities for the Financial Statements
33. The auditor’s report shall include a section with a heading “Responsibilities of
Management for the Financial Statements.” The auditor’s report shall use the
term that is appropriate in the context of the legal framework applicable to the
13
SA 570(Revised), Going Concern, paragraphs 21–23.
14
SA 720(Revised), The Auditor’s Responsibilities Relating to Other Information.
SA 700(Revised) 826
entity and need not refer specifically to “management”. In some entities, the
appropriate reference may be to those charged with governance. (Ref: Para.
A39)
34. This section of the auditor’s report shall describe management’s
responsibility for: (Ref: Para. A40–A43)
(a) Preparing the financial statements in accordance with the applicable
financial reporting framework, and for such internal control as management
determines is necessary to enable the preparation of financial statements
that are free from material misstatement, whether due to fraud or error; and
(b) Assessing the entity’s ability to continue as a going concern15 and whether
the use of the going concern basis of accounting is appropriate as well as
disclosing, if applicable, matters relating to going concern. The explanation
of management’s responsibility for this assessment shall include a
description of when the use of the going concern basis of accounting is
appropriate. (Ref: Para. A43)
35. This section of the auditor’s report shall also identify those responsible for
the oversight of the financial reporting process, when those responsible for such
oversight are different from those who fulfill the responsibilities described in
paragraph 34 above. In this case, the heading of this section shall also refer to
“Those Charged with Governance” or such term that is appropriate in the context
of the legal framework applicable to entity. (Ref: Para. A44)
36. When the financial statements are prepared in accordance with a fair
presentation framework, the description of responsibilities for the financial
statements in the auditor’s report shall refer to “the preparation and fair
presentation of these financial statements” or “the preparation of financial
statements that give a true and fair view,” as appropriate in the circumstances.
Auditor’s Responsibilities for the Audit of the Financial Statements
37. The auditor’s report shall include a section with the heading “Auditor’s
Responsibilities for the Audit of the Financial Statements.”
38. This section of the auditor’s report shall: (Ref: Para. A45)
(a) State that the objectives of the auditor are to:
(i) Obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement,
whether due to fraud or error; and
15
SA 570 (Revised), paragraph 2.
827 SA 700(Revised)
(ii) Issue an auditor’s report that includes the auditor’s opinion. (Ref:
Para. A46)
(b) State that reasonable assurance is a high level of assurance, but is not a
guarantee that an audit conducted in accordance with SAs will always
detect a material misstatement when it exists; and
(c) State that misstatements can arise from fraud or error, and either:
(i) Describe that they are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial
statements; or16
(ii) Provide a definition or description of materiality in accordance with the
applicable financial reporting framework. (Ref: Para. A47)
39. The Auditor’s Responsibilities for the Audit of the Financial Statements
section of the auditor’s report shall further: (Ref: Para. A45)
(a) State that, as part of an audit in accordance with SAs, the auditor exercises
professional judgment and maintains professional skepticism throughout
the audit; and
(b) Describe an audit by stating that the auditor’s responsibilities are:
(i) To identify and assess the risks of material misstatement of the
financial statements, whether due to fraud or error; to design and
perform audit procedures responsive to those risks; and to obtain
audit evidence that is sufficient and appropriate to provide a basis for
the auditor’s opinion. The risk of not detecting a material misstatement
resulting from fraud is higher than for one resulting from error, as
fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
(ii) To obtain an understanding of internal control relevant to the audit in
order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on
the effectiveness of the entity’s internal control. In circumstances
when the auditor also has a responsibility to express an opinion on
the effectiveness of internal control in conjunction with the audit of the
financial statements, the auditor shall omit the phrase that the
auditor’s consideration of internal control is not for the purpose of
expressing an opinion on the effectiveness of the entity’s internal
16
SA 320, Materiality in Planning and Performing an Audit, paragraph 2.
SA 700(Revised) 828
control.
(iii) To evaluate the appropriateness of accounting policies used and the
reasonableness of accounting estimates and related disclosures
made by management.
(iv) To conclude on the appropriateness of management’s use of the
going concern basis of accounting and, based on the audit evidence
obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the entity’s ability to
continue as a going concern. If the auditor concludes that a material
uncertainty exists, the auditor is required to draw attention in the
auditor’s report to the related disclosures in the financial statements
or, if such disclosures are inadequate, to modify the opinion. The
auditor’s conclusions are based on the audit evidence obtained up to
the date of the auditor’s report. However, future events or conditions
may cause an entity to cease to continue as a going concern.
(v) When the financial statements are prepared in accordance with a fair
presentation framework, to evaluate the overall presentation, structure
and content of the financial statements, including the disclosures, and
whether the financial statements represent the underlying transactions
and events in a manner that achieves fair presentation.
(c) When SA 60017 applies, further describe the auditor’s responsibilities in a
group audit engagement by stating:
The division of responsibility for the financial information of the entity by
indicating the extent to which the financial information of components
audited by the other auditors have been included in the financial
information of the entity, e.g., the number of divisions/branches/subsidiaries
or other components audited by other auditors
40. The Auditor’s Responsibilities for the Audit of the Financial Statements
section of the auditor’s report also shall: (Ref: Para. A45)
(a) State that the auditor communicates with those charged with governance
regarding, among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in
internal control that the auditor identifies during the audit;
(b) State that the auditor provides those charged with governance with a
statement that the auditor has complied with relevant ethical requirements
17 SA 600, Using the Work of Another Auditor.
829 SA 700(Revised)
regarding independence and communicate with them all relationships and

other matters that may reasonably be thought to bear on the auditor’s
independence, and where applicable, related safeguards; and
(c) For audits of financial statements of all such entities for which key audit
matters are communicated in accordance with SA 701, state that, from the
matters communicated with those charged with governance, the auditor
determines those matters that were of most significance in the audit of the
financial statements of the current period and are therefore the key audit
matters. In accordance with the requirements of SA 701, the auditor
describes these matters in the auditor’s report unless law or regulation
precludes public disclosure about the matter or when, in extremely rare
circumstances, the auditor determines that a matter should not be
communicated in the auditor’s report because the adverse consequences
of doing so would reasonably be expected to outweigh the public interest
benefits of such communication. (Ref: Para. A48)
Location of the description of the auditor’s responsibilities for the audit of the
financial statements
41. The description of the auditor’s responsibilities for the audit of the financial
statements required by paragraphs 39-40 shall be included: (Ref: Para. A49)
(a) Within the body of the auditor’s report;
(b) Within an appendix to the auditor’s report, in which case the auditor’s report
shall include a reference to the location of the appendix; or (Ref: Para.
A49–A50)
(c) By a specific reference within the auditor’s report to the location of such a
description on a website of an appropriate authority, where law, regulation
or the applicable auditing standards expressly permit the auditor to do so.
(Ref: Para. A49, A51–A52)
42. When the auditor refers to a description of the auditor’s responsibilities on a
website of an appropriate authority, the auditor shall determine that such
description addresses, and is not inconsistent with, the requirements in
paragraphs 38–39 of this SA. (Ref: Para. A51)
Other Reporting Responsibilities
43. If the auditor addresses other reporting responsibilities in the auditor’s report
on the financial statements that are in addition to the auditor’s responsibilities
under the SAs, these other reporting responsibilities shall be addressed in a
SA 700(Revised) 830
separate section in the auditor’s report with a heading titled “Report on Other
Legal and Regulatory Requirements” or otherwise as appropriate to the content
of the section, unless these other reporting responsibilities address the same
topics as those presented under the reporting responsibilities required by the
SAs in which case the other reporting responsibilities may be presented in the
same section as the related report elements required by the SAs. (Ref: Para.
A53–A55)
44. If other reporting responsibilities are presented in the same section as the
related report elements required by the SAs, the auditor’s report shall clearly
differentiate the other reporting responsibilities from the reporting that is required
by the SAs. (Ref: Para. A55)
45. If the auditor’s report contains a separate section that addresses other
reporting responsibilities, the requirements of paragraphs 20–40 of this SA shall
be included under a section with a heading “Report on the Audit of the Financial
Statements.” The “Report on Other Legal and Regulatory Requirements” shall
follow the “Report on the Audit of the Financial Statements.” (Ref: Para. A55)
Signature of the Auditor
46. The auditor’s report shall be signed. The report is signed by the auditor
(i.e. the engagement partner) in his personal name. Where the firm is appointed
as the auditor, the report is signed in the personal name of the auditor and in the
name of the audit firm. The partner/proprietor signing the audit report also needs
to mention the membership number assigned by the Institute of Chartered
Accountants of India. They also include the registration number of the firm,
wherever applicable, as allotted by ICAI, in the audit reports signed by them18.
(Ref: Para. A56-A57)
Place of Signature
47. The auditor’s report shall name specific location, which is ordinarily the city
where the auditor’s report is signed.
18
The Council of the ICAI, at its 292nd meeting held in January 2010, decided to require the
members of the ICAI to include, in addition to the other requirements relating to signature on the
audit report, as prescribed under the relevant Standard on Auditing, the registration number of the
firm as allotted by ICAI, in the audit reports signed by them, and ensure that the resolution passed
by the company regarding appointment of the statutory auditor of the company under section 224
of the Companies Act, 1956, also contain the registration number of the firm of the auditor(s) with
the ICAI. These requirements came into effect from April 1, 2010. Subsequently, the Council of the
ICAI, at its 296th meeting held in June 2010, decided to extend the requirement to mention the firm
registration number to all reports issued pursuant to any attestation engagement, including
certificates, issued by the members as proprietor of/ partner in the said firm. The requirement
applies where such firm registration number has been allotted by the ICAI. The Council further
decided to make this requirement effective for all attestation reports/ certificates issued on or after
1st October, 2010.
831 SA 700(Revised)
Date of the Auditor’s Report

48. The auditor’s report shall be dated no earlier than the date on which the
auditor has obtained sufficient appropriate audit evidence on which to base the
auditor’s opinion on the financial statements, including evidence that: (Ref: Para.
A58–A61)
(a) All the statements that comprise the financial statements, including the
related notes, have been prepared; and
(b) Those with the recognized authority have asserted that they have taken
responsibility for those financial statements.
Auditor’s Report Prescribed by Law or Regulation
49. If the auditor is required by law or regulation applicable to the entity to use
a specific layout, or wording of the auditor’s report, the auditor’s report shall refer
to Standards on Auditing only if the auditor’s report includes, at a minimum, each
of the following elements: (Ref: Para. A62– A63)
(a) A title.
(b) An addressee, as required by the circumstances of the engagement.
(c) An Opinion section containing an expression of opinion on the financial
statements and a reference to the applicable financial reporting framework
used to prepare the financial statements (see paragraph 27).
(d) An identification of the entity’s financial statements that have been audited.
(e) A statement that the auditor is independent of the entity in accordance with
the relevant ethical requirements relating to the audit, and has fulfilled the
auditor’s other ethical responsibilities in accordance with these
requirements. The statement shall refer to the Code of Ethics issued by
ICAI.
(f) Where applicable, a section that addresses, and is not inconsistent with,
the reporting requirements in paragraph 22 of SA 570 (Revised).
(g) Where applicable, a Basis for Qualified (or Adverse) Opinion section that
addresses, and is not inconsistent with, the reporting requirements in
paragraph 23 of SA 570 (Revised).
(h) Where applicable, a section that includes the information required by SA
701, or additional information about the audit that is prescribed by law or
regulation and that addresses, and is not inconsistent with, the reporting
SA 700(Revised) 832
requirements in that SA.19 (Ref: Para. A64–A67)

(i) Where applicable, a section that addresses the reporting requirements in
paragraph 24 of SA 720 (Revised).
(j) A description of management’s responsibilities for the preparation of the
financial statements and an identification of those responsible for the
oversight of the financial reporting process that addresses, and is not
inconsistent with, the requirements in paragraphs 33-36.
(k) A reference to Standards on Auditing and the law or regulation, and a
description of the auditor’s responsibilities for an audit of the financial
statements that addresses, and is not inconsistent with, the requirements in
paragraphs 37-40. (Ref: Para. A49–A50)
(l) The auditor’s signature.
(m) The Place of signature
(n) The date of the auditor’s report.
Auditor’s Report for Audits Conducted in Accordance with Both Standards
on Auditing issued by ICAI and International Standards on Auditing or
Auditing Standards of Any Other Jurisdiction
50. An auditor may be required to conduct an audit in accordance with, in
addition to the Standards on Auditing issued by ICAI, the International Standards
on Auditing or auditing standards of any other jurisdiction. If this is the case, the
auditor’s report may refer to Standards on Auditing in addition to the International
Standards on Auditing or auditing standards of such other jurisdiction, but the
auditor shall do so only if: (Ref: Para. A68–A69)
(a) There is no conflict between the requirements in the ISAs or such auditing
standards of other jurisdiction and those in SAs that would lead the auditor
(i) to form a different opinion, or (ii) not to include an Emphasis of Matter
paragraph or Other Matter paragraph that, in the particular circumstances,
is required by SAs; and
(b) The auditor’s report includes, at a minimum, each of the elements set out in
paragraphs 49(a)–(n) above when the auditor uses the layout or wording
specified by the Standards on Auditing. However, reference to “law or
regulation” in paragraph 49(k) shall be read as reference to the Standards
on Auditing. The auditor’s report shall thereby identify such Standards on
Auditing.
19
SA 701, paragraphs 11–16.
833 SA 700(Revised)
51. When the auditor’s report refers to both the ISAs or the auditing standards of
a specific jurisdiction and the Standards on Auditing issued by ICAI, the auditor’s
report shall clearly identify the same including the jurisdiction of origin of the
other auditing standards.
Supplementary Information Presented with the Financial Statements
(Ref: Para. A70–A76)
52. If supplementary information that is not required by the applicable financial
reporting framework is presented with the audited financial statements, the
auditor shall evaluate whether, in the auditor’s professional judgment,
supplementary information is nevertheless an integral part of the financial
statements due to its nature or how it is presented. When it is an integral part of
the financial statements, the supplementary information shall be covered by the
auditor’s opinion.
53. If supplementary information that is not required by the applicable financial
reporting framework is not considered an integral part of the audited financial
statements, the auditor shall evaluate whether such supplementary information is
presented in a way that sufficiently and clearly differentiates it from the audited
financial statements. If this is not the case, then the auditor shall ask
management to change how the unaudited supplementary information is
presented. If management refuses to do so, the auditor shall identify the
unaudited supplementary information and explain in the auditor’s report that such
supplementary information has not been audited.
***
Application and Other Explanatory Material
Qualitative Aspects of the Entity’s Accounting Practices (Ref: Para.
12)
A1. Management makes a number of judgments about the amounts and
disclosures in the financial statements.
A2. SA 260(Revised) contains a discussion of the qualitative aspects of
accounting practices20. In considering the qualitative aspects of the entity’s
accounting practices, the auditor may become aware of possible bias in
management’s judgments. The auditor may conclude that the cumulative effect
of a lack of neutrality, together with the effect of uncorrected misstatements,
causes the financial statements as a whole to be materially misstated. Indicators
of a lack of neutrality that may affect the auditor’s evaluation of whether the
20
SA 260 (Revised), Communication with Those Charged with Governance, Appendix 2.
SA 700(Revised) 834
financial statements as a whole are materially misstated include the following:

• The selective correction of misstatements brought to management’s
attention during the audit (e.g., correcting misstatements with the effect of
increasing reported earnings, but not correcting misstatements that have
the effect of decreasing reported earnings).
• Possible management bias in the making of accounting estimates.
A3. SA 540 addresses possible management bias in making accounting
estimates.21 Indicators of possible management bias do not constitute
misstatements for purposes of drawing conclusions on the reasonableness of
individual accounting estimates. They may, however, affect the auditor’s
evaluation of whether the financial statements as a whole are free from material
misstatement.
Disclosures of the Effect of Material Transactions and Events on
the Information Conveyed in the Financial Statements (Ref: Para.
13(e))
A4. It is common for financial statements prepared in accordance with a
general purpose framework to present an entity’s financial position, financial
performance and cash flows. In such circumstances, the auditor evaluates
whether the financial statements provide adequate disclosures to enable the
intended users to understand the effect of material transactions and events on
the entity’s financial position, financial performance and cash flows.
Description of the Applicable Financial Reporting Framework (Ref:
Para. 15)
A5. As explained in SA 200, the preparation of the financial statements by
management and, where appropriate, those charged with governance requires
the inclusion of an adequate description of the applicable financial reporting
framework in the financial statements.22 That description advises users of the
financial statements of the framework on which the financial statements are
based.
A6. A description that the financial statements are prepared in accordance
with a particular applicable financial reporting framework is appropriate only if the
financial statements comply with all the requirements of that framework that are
effective during the period covered by the financial statements.
21
SA 540, Auditing Accounting Estimates, Including Fair Value Accounting Estimates, and Related
Disclosures, paragraph 21.
22
SA 200, paragraphs A2–A3.
835 SA 700(Revised)
A7. A description of the applicable financial reporting framework that contains

imprecise qualifying or limiting language (e.g., “the financial statements are in
substantial compliance with Accounting Standards”) is not an adequate
description of that framework as it may mislead users of the financial statements.
Reference to More than One Financial Reporting Framework
A8. In some cases, the financial statements may represent that they are
prepared in accordance with two financial reporting frameworks (e.g., Accounting
Standards referred to in section 133 of the Companies Act, 2013 and the IFRSs).
This may be because management is required, or has chosen, to prepare the
financial statements in accordance with both frameworks, in which case both are
applicable financial reporting frameworks. Such description is appropriate only if
the financial statements comply with each of the frameworks individually. To be
regarded as being prepared in accordance with both frameworks, the financial
statements need to comply with both frameworks simultaneously and without
any need for reconciling statements. In practice, simultaneous compliance is
unlikely unless the other framework (e.g., IFRSs) has been adopted as the
framework applicable to that entity, or has eliminated all barriers to compliance
with it.
A9. Financial statements that are prepared in accordance with one financial
reporting framework and that contain a note or supplementary statement
reconciling the results to those that would be shown under another framework
are not prepared in accordance with that other framework. This is because the
financial statements do not include all the information in the manner required by
that other framework.
A10. The financial statements may, however, be prepared in accordance with
one applicable financial reporting framework and, in addition, describe in the
notes to the financial statements the extent to which the financial statements
comply with another framework (e.g., financial statements prepared in
accordance with the Accounting Standards that also describe the extent to which
they comply with IFRSs). Such description may constitute supplementary
financial information as discussed in paragraph 53 and is covered by the
auditor’s opinion if it cannot be clearly differentiated from the financial
statements.
Form of Opinion (Ref: Para. 18–19)
A11. There may be cases where the financial statements, although prepared in
accordance with the requirements of a fair presentation framework, do not
achieve fair presentation. Where this is the case, it may be possible for
management to include additional disclosures in the financial statements beyond
SA 700(Revised) 836
those specifically required by the framework or, in extremely rare circumstances,

to depart from a requirement in the framework in order to achieve fair
presentation of the financial statements.
A12. It will be extremely rare for the auditor to consider financial statements that
are prepared in accordance with a compliance framework to be misleading if, in
accordance with SA 210, the auditor determined that the framework is
acceptable.23
Auditor’s Report (Ref: Para. 20)
A13. A written report encompasses reports issued in hard copy and those using
an electronic medium.
A14. The Appendix to this SA contains illustrations of auditor’s reports on
financial statements, incorporating the elements set out in paragraphs 20–48.
With the exception of the Opinion and Basis for Opinion sections, this SA does
not establish requirements for ordering the elements of the auditor’s report.
However, this SA requires the use of specific headings, which are intended to
assist in making auditor’s reports that refer to audits that have been conducted in
accordance with SAs more recognizable, particularly in situations where the
elements of the auditor’s report are presented in an order that differs from the
illustrative auditor’s reports in the Appendix to this SA.
Auditor’s Report for Audits Conducted in Accordance with Standards on
Auditing
Title (Ref: Para. 21)
A15. A title indicating the report is the report of an independent auditor, for
example, “Independent Auditor’s Report,” distinguishes the independent
auditor’s report from reports issued by others.
Addressee (Ref: Para. 22)
A16. Law, regulation or the terms of the engagement may specify to whom the
auditor’s report is to be addressed in that particular jurisdiction. The auditor’s
report is normally addressed to those for whom the report is prepared, often
either to the shareholders or to those charged with governance of the entity
whose financial statements are being audited.
Auditor’s Opinion (Ref. Para. 24–26)
Reference to the financial statements that have been audited
A17. The auditor’s report states, for example, that the auditor has audited the
financial statements of the entity, which comprise [state the title of each financial
statement comprising the complete set of financial statements required by the
23
SA 210, Agreeing the Terms of Audit Engagements, paragraph 6(a).
837 SA 700(Revised)
applicable financial reporting framework, specifying the date or period covered

by each financial statement] and notes to the financial statements, including a
summary of significant accounting policies.
A18. When the auditor is aware that the audited financial statements will be
included in a document that contains other information, such as an annual
report, the auditor may consider, if the form of presentation allows, identifying the
page numbers on which the audited financial statements are presented. This
helps users to identify the financial statements to which the auditor’s report
relates.
“Present fairly, in all material respects” or “give a true and fair view”
A19. The phrases “present fairly, in all material respects,” and “give a true and
fair view” are regarded as being equivalent. Whether the phrase “present fairly,
in all material respects,” or the phrase “give a true and fair view” is used in any
particular jurisdiction is determined by the law or regulation governing the audit
of financial statements in that jurisdiction, or by generally accepted practice in
that jurisdiction. Where law or regulation requires the use of different wording,
this does not affect the requirement in paragraph 14 of this SA for the auditor to
evaluate the fair presentation of financial statements prepared in accordance
with a fair presentation framework.
A20. When the auditor expresses an unmodified opinion, it is not appropriate to
use phrases such as “with the foregoing explanation” or “subject to” in relation to
the opinion, as these suggest a conditional opinion or a weakening or
modification of opinion.
Description of the financial statements and the matters they present
A21. The auditor’s opinion covers the complete set of financial statements as
defined by the applicable financial reporting framework. For example, in the case
of many general purpose frameworks, the financial statements may include:
balance sheet, profit and loss account, a statement of changes in equity, a
statement of cash flows, and related notes, which ordinarily comprise a summary
of significant accounting policies and other explanatory information. In some
entities, additional information may also be considered to be an integral part of
the financial statements.
A22. In the case of financial statements prepared in accordance with a fair
presentation framework, the auditor’s opinion states that the financial statements
present fairly, in all material respects, or give a true and fair view of, the matters
that the financial statements are designed to present. For example, in the case
of financial statements of companies prepared in accordance with the
Companies (Indian Accounting Standards) Rules, 2015, these matters are: true
SA 700(Revised) 838
and fair view of the state of affairs of the company as at the end of its financial
year and its profit or loss, (changes in equity)24 and its cash flows for the year
ended on that date. Consequently, the […] in paragraph 25 and elsewhere in this
SA is intended to be replaced by the words in italics in the preceding sentence
when the applicable financial reporting framework is Indian Accounting
Standards (Ind AS)/ Accounting Standards or, in the case of other applicable
financial reporting frameworks, be replaced with words that describe the matters
that the financial statements are designed to present.
Description of the applicable financial reporting framework and how it may affect
the auditor’s opinion
A23. The identification of the applicable financial reporting framework in the
auditor’s opinion is intended to advise users of the auditor’s report of the context
in which the auditor’s opinion is expressed; it is not intended to limit the
evaluation required in paragraph 14. The applicable financial reporting
framework is identified in such terms as:
“….In accordance with the Accounting Standards prescribed under section
133 of the Companies Act, 2013” or
“….In accordance with the Accounting Standards issued by the Institute of
Chartered Accountants of India” or
“… in accordance with the International Financial Reporting Standards”.
A24. When the applicable financial reporting framework encompasses financial
reporting standards and legal or regulatory requirements, the framework is
identified in such terms as “…in accordance with the Accounting Standards
prescribed under section 133 of the Companies Act, 2013”. SA 210 deals with
circumstances where there are conflicts between the financial reporting
standards and the legislative or regulatory requirements.25
A25. As indicated in paragraph A8, the financial statements may be prepared in
accordance with two financial reporting frameworks, which are therefore both
applicable financial reporting frameworks. Accordingly, each framework is
considered separately when forming the auditor’s opinion on the financial
statements, and the auditor’s opinion in accordance with paragraphs 25–27
refers to both frameworks as follows:
(a) If the financial statements comply with each of the frameworks individually,
two opinions are expressed: that is, that the financial statements are
24
Where applicable.
25
SA 210, paragraph 18.
839 SA 700(Revised)
prepared in accordance with one of the applicable financial reporting

frameworks (e.g., in case of a company incorporated in India, the
Accounting Standards prescribed under section 133 of the Companies Act,
2013) and an opinion that the financial statements are prepared in
accordance with the other applicable financial reporting framework (e.g.,
IFRSs). These opinions may be expressed separately or in a single
sentence (e.g., the financial statements are presented fairly, in all material
respects […], in accordance with the Accounting Standards prescribed
under section 133 of the Companies Act, 2013 and with IFRSs).
(b) If the financial statements comply with one of the frameworks but fail to
comply with the other framework, an unmodified opinion can be given that
the financial statements are prepared in accordance with the one
framework (e.g., in case of a company incorporated in India, the Accounting
Standards prescribed under section 133 of the Companies Act, 2013) but a
modified opinion given with regard to the other framework (e.g., IFRSs) in
accordance with SA 705(Revised).
A26. As indicated in paragraph A10, the financial statements may represent
compliance with the applicable financial reporting framework and, in addition,
disclose the extent of compliance with another financial reporting framework.
Such supplementary information is covered by the auditor’s opinion if it cannot
be clearly differentiated from the financial statements (see paragraphs 52-53 and
related application material in paragraphs A70–A76). Accordingly,
(a) If the disclosure as to the compliance with the other framework is
misleading, a modified opinion is expressed in accordance with SA 705
(Revised).
(b) If the disclosure is not misleading, but the auditor judges it to be of such
importance that it is fundamental to the users’ understanding of the
financial statements, an Emphasis of Matter paragraph is added in
accordance with SA 706 (Revised), drawing attention to the disclosure.
Basis for Opinion (Ref: Para. 28)
A27. The Basis for Opinion section provides important context about the
auditor’s opinion. Accordingly, this SA requires the Basis for Opinion section to
directly follow the Opinion section in the auditor’s report.
A28. The reference to the standards used conveys to the users of the auditor’s
report that the audit has been conducted in accordance with established
standards.
Relevant ethical requirements
SA 700(Revised) 840
A29. The identification of the applicable relevant ethical requirements increases

transparency about those requirements relating to the particular audit
engagement. SA 200 explains that relevant ethical requirements ordinarily
comprise of Code of Ethics issued by the Institute of Chartered Accountants of
India26. When the relevant ethical requirements include those of the Code of
Ethics, the statement may also make reference to the Code of Ethics. If the
Code of Ethics related to an audit of financial statements constitutes all of the
ethical requirements relevant to the audit, the statement need not identify a
jurisdiction of origin.
A30. Relevant ethical requirements may exist in several different sources, such
as the ethical code(s) and additional rules and requirements within law and
regulation. When the independence and other relevant ethical requirements are
contained in a limited number of sources, the auditor may choose to name the
relevant source(s) (e.g., the name of the code, rule or regulation applicable in the
jurisdiction), or may refer to a term that is commonly understood and that
appropriately summarizes those sources (e.g., independence requirements for
audits of private entities in Jurisdiction X).
A31. Law or regulation, applicable auditing standards or the terms of an audit
engagement may require the auditor to provide in the auditor’s report more
specific information about the sources of the relevant ethical requirements,
including those pertaining to independence that applied to the audit of the
A32. In determining the appropriate amount of information to include in the
auditor’s report when there are multiple sources of relevant ethical requirements
relating to the audit of the financial statements, an important consideration is
balancing transparency against the risk of obscuring other useful information in
the auditor’s report.
Considerations specific to group audits
A33. In group audits when there are multiple sources of relevant ethical
requirements, including those pertaining to independence, the reference in the
auditor’s report to the relevant ethical requirements refers to those that are
applicable to the principal auditor.
A34. The SAs do not establish specific independence or ethical requirements
for auditors, including component auditors, and thus do not extend, or otherwise
26
SA 200, paragraph A14.
841 SA 700(Revised)
override, the independence requirements of the ICAI Code of Ethics to which the
principal auditor is subject, nor do the SAs require that the component auditor in
all cases to be subject to the same specific independence requirements that are
applicable to the principal auditor.
Key Audit Matters (Ref: Para. 31)
A35. Law or regulation may require communication of key audit matters for
audits of entities other than listed entities, for example, entities characterized in
such law or regulation as public interest entities.
A36. The auditor may also decide to communicate key audit matters for other
entities, including those that may be of significant public interest, for example
because they have a large number and wide range of stakeholders and
considering the nature and size of the business. Examples of such entities may
include financial institutions (such as banks, insurance companies, and pension
funds), and other entities such as charities.
A37. SA 210 requires the auditor to agree the terms of the audit engagement
with management and those charged with governance, as appropriate, and
explains that the roles of management and those charged with governance in
agreeing the terms of the audit engagement for the entity depend on the
governance arrangements of the entity and relevant law or regulation27. SA 210
also requires the audit engagement letter or other suitable form of written
agreement to include reference to the expected form and content of any reports
to be issued by the auditor.28 When the auditor is not otherwise required to
communicate key audit matters, SA 21029 explains that it may be helpful for the
auditor to make reference in the terms of the audit engagement to the possibility
of communicating key audit matters in the auditor’s report and, in certain
jurisdictions, it may be necessary for the auditor to include a reference to such
possibility in order to retain the ability to do so.
Considerations specific to public sector entities
A38. Public sector entities, even where not listed, may be significant due to
size, complexity or public interest aspects. In such cases, an auditor of a public
sector entity may be required by law or regulation or may otherwise decide to
communicate key audit matters in the auditor’s report.
Responsibilities for the Financial Statements (Ref: Para. 33–34)
27 SA 210, paragraphs 9 and A21.

28 SA 210, paragraph 10.
29 SA 210, paragraph A24.
SA 700(Revised) 842
A39. SA 200 explains the premise, relating to the responsibilities of

management and, where appropriate, those charged with governance, on which
an audit in accordance with SAs is conducted.30 Management and, where
appropriate, those charged with governance accept responsibility for the
preparation of the financial statements in accordance with the applicable
financial reporting framework, including, where relevant, their fair presentation.
Management also accepts responsibility for such internal control as it determines
is necessary to enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error. The description of
management’s responsibilities in the auditor’s report includes reference to both
responsibilities as it helps to explain to users the premise on which an audit is
conducted. SA 260 (Revised) uses the term those charged with governance to
describe the person(s) or organization(s) with responsibility for overseeing the
entity, and provides a discussion about the diversity of governance structures
across jurisdictions and by entity.
A40. There may be circumstances when it is appropriate for the auditor to add
to the descriptions of the responsibilities of management and those charged with
governance in paragraphs 34-35 to reflect additional responsibilities that are
relevant to the preparation of the financial statements in the context of the
particular jurisdiction or the nature of the entity.
A41. SA 210 requires the auditor to agree management’s responsibilities in an
engagement letter or other suitable form of written agreement.31 SA 210 provides
some flexibility in doing so, by explaining that, if law or regulation prescribes the
responsibilities of management and, where appropriate, those charged with
governance in relation to financial reporting, the auditor may determine that the
law or regulation includes responsibilities that, in the auditor’s judgment, are
equivalent in effect to those set out in SA 210. For such responsibilities that are
equivalent, the auditor may use the wording of the law or regulation to describe
them in the engagement letter or other suitable form of written agreement. In
such cases, this wording may also be used in the auditor’s report to describe the
responsibilities as required by paragraph 34(a) of this SA. In other
circumstances, including where the auditor decides not to use the wording of law
or regulation as incorporated in the engagement letter, the wording in paragraph
34(a) of this SA is used. In addition to including the description of management’s
responsibilities in the auditor’s report as required by paragraph 34, the auditor
may refer to a more detailed description of these responsibilities by including a
30 SA 200, paragraph 13(j).

31 SA 210, paragraph 6(b)(i)–(ii).
843 SA 700(Revised)
reference to where such information may be obtained (e.g., in the annual report
of the entity or a website of an appropriate authority).
A42. In some entities, law or regulation prescribing management’s
responsibilities may specifically refer to a responsibility for the adequacy of
accounting books and records, or accounting system. As books, records and
systems are an integral part of internal control (as defined in SA 31532), the
descriptions in SA 210 and in paragraph 34 do not make specific reference to
them.
A43. The Appendix to this SA provides illustrations of how the requirement in
paragraph 34(b) would be applied when Accounting Standards is the applicable
financial reporting framework. If an applicable financial reporting framework other
than Accounting Standards is used, the illustrative statements featured in the
Appendix to this SA may need to be adapted to reflect the application of the
other financial reporting framework in the circumstances.
Oversight of the financial reporting process (Ref: Para. 35)
A44. When some, but not all, of the individuals involved in the oversight of the
financial reporting process are also involved in preparing the financial
statements, the description as required by paragraph 35 of this SA may need to
be modified to appropriately reflect the particular circumstances of the entity.
When individuals responsible for the oversight of the financial reporting process
are the same as those responsible for the preparation of the financial
statements, no reference to oversight responsibilities is required.
Auditor’s Responsibilities for the Audit of the Financial Statements (Ref: Para.
37-40)
A45. The description of the auditor’s responsibilities as required by paragraphs
37-40 of this SA may be tailored to reflect the specific nature of the entity, for
example, when the auditor’s report addresses consolidated financial statements.
Illustration 2 in the Appendix to this SA includes an example of how this may be
done.
Objectives of the auditor (Ref: Para. 38(a))
A46. The auditor’s report explains that the objectives of the auditor are to obtain
reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an
auditor’s report that includes the auditor’s opinion. These are in contrast to
management’s responsibilities for the preparation of the financial statements.
32SA 315, Identifying and Assessing the Risks of Material Misstatement through Understanding the
Entity and Its Environment, paragraph 4(c).
SA 700(Revised) 844
Description of materiality (Ref: Para. 38(c))

A47. The Appendix to this SA provides illustrations of how the requirement in
paragraph 38(c), to provide a description of materiality, would be applied when
Accounting Standards is the applicable financial reporting framework. If an
applicable financial reporting framework other than Accounting Standards is
used, the illustrative statements presented in the Appendix to this SA may need
to be adapted to reflect the application of the other financial reporting framework
in the circumstances.
Auditor’s responsibilities relating to SA 701 (Ref: Para. 40(c))
A48. The auditor may also consider it useful to provide additional information in
the description of the auditor’s responsibilities beyond what is required by
paragraph 40(c). For example, the auditor may make reference to the
requirement in paragraph 9 of SA 701 to determine the matters that required
significant auditor attention in performing the audit, taking into account areas of
higher assessed risk of material misstatement or significant risks identified in
accordance with SA 315; significant auditor judgments relating to areas in the
financial statements that involved significant management judgment, including
accounting estimates that have been identified as having high estimation
uncertainty; and the effects on the audit of significant events or transactions that
occurred during the period.
Location of the description of the auditor’s responsibilities for the audit of the
financial statements (Ref: Para. 41, 49(k))
A49. Including the information required by paragraphs 39-40 of this SA in an
appendix to the auditor’s report or, when law, regulation or applicable auditing
standards expressly permit, referring to a website of an appropriate authority
containing such information may be a useful way of streamlining the content of
the auditor’s report. However, because the description of the auditor’s
responsibilities contains information that is necessary to inform users’
expectations of an audit conducted in accordance with SAs, a reference is
required to be included in the auditor’s report indicating where such information
can be accessed.
Location in an appendix (Ref: Para. 41(b), 49(k))
A50. Paragraph 41 permits the auditor to include the statements required by
paragraphs 39-40 describing the auditor’s responsibilities for the audit of the
financial statements in an appendix to the auditor’s report, provided that
appropriate reference is made within the body of the auditor’s report to the
location of the appendix. The following is an illustration of how such a reference
to an appendix could be made in the auditor’s report:
845 SA 700(Revised)
Auditor’s Responsibilities for the Audit of the Financial

Statements
Our objectives are to obtain reasonable assurance about
whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and
to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance
with SAs will always detect a material misstatement when
it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the
economic decisions of users taken on the basis of these
A further description of our responsibilities for the audit of
the financial statements is included in appendix X of this
auditor’s report. This description, which is located at
[indicate page number or other specific reference to the
location of the description], forms part of our auditor’s
report.
Reference to a website of an appropriate authority (Ref: Para. 41(c), 42)
A51. Paragraph 41 explains that the auditor may refer to a description of the
auditor’s responsibilities located on a website of an appropriate authority, only if
expressly permitted by law, regulation or the applicable auditing standards. The
information on the website that is incorporated in the auditor’s report by way of a
specific reference to the website location where such information can be found
may describe the auditor’s work, or the audit in accordance with SAs more
broadly, but it cannot be inconsistent with the description required in paragraphs
39-40 of this SA. This means that the wording of the description of the auditor’s
responsibilities on the website may be more detailed, or may address other
matters relating to an audit of financial statements, provided that such wording
reflects and does not contradict the matters addressed in paragraphs 39-40.
A52. An appropriate authority could be a national auditing standard setter,
regulator, or an audit oversight body. Such organizations are well-placed to
ensure the accuracy, completeness and continued availability of the
standardized information. It would not be appropriate for the auditor to maintain
such a website. The following is an illustration of how such a reference to a
website could be made in the auditor’s report:
SA 700(Revised) 846
Auditor’s Responsibilities for the Audit of the Financial

Statements
Our objectives are to obtain reasonable assurance about
whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and
to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance with
SAs will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial
statements.
A further description of our responsibilities for the audit of
the financial statements is located at [Organization’s]
website at: [website address]. This description forms part of
our auditor’s report.
Other Reporting Responsibilities (Ref: Para. 43-45)
A53. In case of some entities, the auditor may have additional responsibilities to
report on other matters that are supplementary to the auditor’s responsibilities
under the SAs. For example, the auditor may be asked to report certain matters
if they come to the auditor’s attention during the course of the audit of the
financial statements. Alternatively, the auditor may be asked to perform and
report on additional specified procedures, or to express an opinion on specific
matters, such as the adequacy of accounting books and records, internal control
over financial reporting or other information. Standards on Auditing and/or other
relevant pronouncements of the ICAI often provide guidance on the auditor’s
responsibilities with respect to specific additional reporting responsibilities.
A54. In some cases, the relevant law or regulation may require or permit the
auditor to report on these other responsibilities as part of their auditor’s report on
the financial statements. In other cases, the auditor may be required or permitted
to report on them in a separate report.
A55. Paragraphs 43-45 of this SA permit combined presentation of other
reporting responsibilities and the auditor’s responsibilities under the SAs only
when they address the same topics and the wording of the auditor’s report
clearly differentiates the other reporting responsibilities from those under the
SAs. Such clear differentiation may make it necessary for the auditor’s report to
847 SA 700(Revised)
refer to the source of the other reporting responsibilities and to state that such
responsibilities are beyond those required under the SAs. Otherwise, other
reporting responsibilities are required to be addressed in a separate section in
the auditor’s report with a heading “Report on Other Legal and Regulatory
Requirements,” or otherwise as appropriate to the content of the section. In such
cases, paragraph 45 requires the auditor to include reporting responsibilities
under the SAs under a heading titled “Report on the Audit of the Financial
Statements.”
Signature of the Auditor (Ref: Para 46)
A56. SQC 133 requires that the firm should establish policies and procedures to
provide reasonable assurance that engagements are performed in accordance
with professional standards and applicable legal and regulatory requirements.
Notwithstanding these SQC 1 requirements, naming the engagement partner in
the auditor’s report is intended to provide further transparency to the users of the
auditor’s report of a complete set of general purpose financial statements of an
entity.
A57. In some cases, law or regulation may allow for the use of electronic
signatures in the auditor’s report.
Date of the Auditor’s Report (Ref: Para. 48)
A58. The date of the auditor’s report informs the user of the auditor’s report that
the auditor has considered the effect of events and transactions of which the
auditor became aware and that occurred up to that date. The auditor’s
responsibility for events and transactions after the date of the auditor’s report is
addressed in SA 560.34
A59. Since the auditor’s opinion is provided on the financial statements and the
financial statements are the responsibility of management, the auditor is not in a
position to conclude that sufficient appropriate audit evidence has been obtained
until evidence is obtained that all the statements that comprise the financial
statements, including the related notes, have been prepared and management
has accepted responsibility for them.
A60. In the case of some entities, the applicable law or regulation identifies the
individuals or bodies (e.g., the directors) that are responsible for concluding that
all the statements that comprise the financial statements, including the related
notes, have been prepared, and specifies the necessary approval process. In
such cases, evidence is obtained of that approval before dating the report on the
33 SQC 1, Quality Control for Firms that Perform Audits and Reviews of Historical Financial
Information, and Other Assurance and Related Services Engagements, paragraph 3.
34 SA 560, Subsequent Events, paragraphs 10–17.
SA 700(Revised) 848
financial statements. In case of some entities, however, the approval process

may not be prescribed in the applicable law or regulation. In such cases, the
procedures the entity follows in preparing and finalizing its financial statements in
view of its management and governance structures are considered in order to
identify the individuals or body with the authority to conclude that all the
statements that comprise the financial statements, including the related notes,
have been prepared. In some cases, law or regulation identifies the point in the
financial statement reporting process at which the audit is expected to be
complete.
A61. In the case of some entities, the final approval of the financial statements
by shareholders is required before the financial statements are issued publicly.
Final approval by shareholders is not necessary for the auditor to conclude that
sufficient appropriate audit evidence has been obtained. The date of approval of
the financial statements for purposes of SAs is the earlier date on which those
with the recognized authority determine that all the statements that comprise the
financial statements, including the related notes, have been prepared and that
those with the recognized authority have asserted that they have taken
responsibility for them.
Auditor’s Report Prescribed by Law or Regulation (Ref: Para 49)
A62. SA 200 explains that the auditor may be required to comply with legal or
regulatory requirements in addition to SAs.35 When the differences between the
legal or regulatory requirements and SAs relate only to the layout and wording of
the auditor’s report, the requirements in paragraph 49(a)–(n) set out the
minimum elements to be included in the auditor’s report to enable a reference to
the Standards on Auditing. In those circumstances, the requirements in
paragraphs 21–48 that are not included in paragraph 49(a)–(n) do not need to be
applied including, for example, the required ordering of the Opinion and Basis for
Opinion sections.
A63. Where specific requirements in a particular law or regulation do not
conflict with SAs, the layout and wording required by paragraphs 21–48 of this
SA assist users of the auditor’s report in more readily recognizing the auditor’s
report as a report of an audit conducted in accordance with SAs.
Information Required by SA 701 (Ref: Para. 49(h))
A64. Law or regulation may require the auditor to provide additional information
about the audit that was performed, which may include information that is
consistent with the objectives of SA 701, or may prescribe the nature and extent
of communication about such matters.
35 SA 200, paragraph A56.
849 SA 700(Revised)
A65. The SAs do not override law or regulation that governs an audit of
financial statements. When SA 701 is applicable, reference can only be made to
SAs in the auditor’s report if, in applying the law or regulation, the section
required by paragraph 49(h) of this SA is not inconsistent with the reporting
requirements in SA 701. In such circumstances, the auditor may need to tailor
certain aspects of the communication of key audit matters in the auditor’s report
required by SA 701, for example by:
• Modifying the heading “Key Audit Matters”, if law or regulation prescribes a
specific heading;
• Explaining why the information required by law or regulation is being
provided in the auditor’s report, for example by making a reference to the
relevant law or regulation and describing how that information relates to the
key audit matters;
• Where law or regulation prescribes the nature and extent of the description,
supplementing the prescribed information to achieve an overall description
of each key audit matter that is consistent with the requirement in
paragraph 13 of SA 701.
A66. SA 210 deals with circumstances where law or regulation applicable to the
entity prescribes the layout or wording of the auditor’s report in terms that are
significantly different from the requirements of SAs, which in particular includes
the auditor’s opinion. In these circumstances, SA 210 requires the auditor to
evaluate:
(a) Whether users might misunderstand the assurance obtained from the audit
of the financial statements and, if so,
(b) Whether additional explanation in the auditor’s report can mitigate possible
misunderstanding.
If the auditor concludes that additional explanation in the auditor’s report cannot
mitigate possible misunderstanding, SA 210 requires the auditor not to accept
the audit engagement, unless required by law or regulation to do so. In
accordance with SA 210, an audit conducted in accordance with such law or
regulation does not comply with SAs. Accordingly, the auditor does not include
any reference in the auditor’s report to the audit having been conducted in
accordance with Standards on Auditing.36
Considerations specific to public sector entities
A67. Auditors of public sector entities may also have the ability pursuant to law
or regulation to report publicly on certain matters, either in the auditor’s report or
36 SA 210, paragraph 21.
SA 700(Revised) 850
in a supplementary report, which may include information that is consistent with

the objectives of SA 701. In such circumstances, the auditor may need to tailor
certain aspects of the communication of key audit matters in the auditor’s report
required by SA 701 or include a reference in the auditor’s report to a description
of the matter in the supplementary report.
Auditor’s Report for Audits Conducted in Accordance with Both Standards
on Auditing issued by ICAI and International Standards on Auditing/
Auditing Standards of Another Jurisdiction (Ref: Para. 50)
A68. The auditor may refer in the auditor’s report to the audit having been
conducted in accordance with both the Standards on Auditing issued by ICAI as
well as the International Standards on Auditing/auditing standards of another
jurisdiction when, in addition to complying with the ISAs/ auditing standards of
such other jurisdiction, the auditor complies with each of the SAs relevant to the
audit.
A69. A reference to both Standards on Auditing issued by ICAI and the
International Standards on Auditing/auditing standards of another jurisdiction is
not appropriate if there is a conflict between the requirements in SAs and those
ISAs/ auditing standards of such other jurisdiction that would lead the auditor to
form a different opinion or not to include an Emphasis of Matter or Other Matter
paragraph that, in the particular circumstances, is required by SAs. In such a
case, the auditor’s report refers only to the auditing standards (either Standards
on Auditing issued by ICAI or ISAs/the auditing standards of such other
jurisdiction) in accordance with which the auditor’s report has been prepared.
Supplementary Information Presented with the Financial Statements
(Ref: Para. 52-53)
A70. In some circumstances, the entity may be required by law, regulation or
standards, or may voluntarily choose, to present together with the financial
statements supplementary information that is not required by the applicable
financial reporting framework. For example, supplementary information might be
presented to enhance a user’s understanding of the applicable financial reporting
framework or to provide further explanation of specific financial statement items.
Such information is normally presented in either supplementary schedules or as
additional notes.
A71. Paragraph 52 of this SA explains that the auditor’s opinion covers
supplementary information that is an integral part of the financial statements
because of its nature or how it is presented. This evaluation is a matter of
professional judgment. To illustrate:
• When the notes to the financial statements include an explanation or the
reconciliation of the extent to which the financial statements comply with
851 SA 700(Revised)
another financial reporting framework, the auditor may consider this to be

supplementary information that cannot be clearly differentiated from the
financial statements. The auditor’s opinion would also cover notes or
supplementary schedules that are cross-referenced from the financial
statements.
• When an additional profit and loss account that discloses specific items of
expenditure is disclosed as a separate schedule included as an Appendix
to the financial statements, the auditor may consider this to be
supplementary information that can be clearly differentiated from the
A72. Supplementary information that is covered by the auditor’s opinion does
not need to be specifically referred to in the auditor’s report when the reference
to the notes in the description of the statements that comprise the financial
statements in the auditor’s report is sufficient.
A73. Law or regulation may not require that the supplementary information be
audited, and management may decide to ask the auditor not to include the
supplementary information within the scope of the audit of the financial
statements.
A74. The auditor’s evaluation whether unaudited supplementary information is
presented in a manner that could be construed as being covered by the auditor’s
opinion includes, for example, where that information is presented in relation to
the financial statements and any audited supplementary information, and
whether it is clearly labeled as “unaudited.”
A75. Management could change the presentation of unaudited supplementary
information that could be construed as being covered by the auditor’s opinion, for
example, by:
• Removing any cross-references from the financial statements to unaudited
supplementary schedules or unaudited notes so that the demarcation
between the audited and unaudited information is sufficiently clear.
• Placing the unaudited supplementary information outside of the financial
statements or, if that is not possible in the circumstances, at a minimum
placing the unaudited notes together at the end of the required notes to the
financial statements and clearly labeling them as unaudited. Unaudited
notes that are intermingled with the audited notes can be misinterpreted as
being audited.
A76. The fact that supplementary information is unaudited does not relieve the
auditor of the responsibilities described in SA 720(Revised).
SA 700(Revised) 852
Appendix
(Ref: Para. A14)
Illustrations of Independent Auditor’s Reports on Financial
Statements
• Illustration 1: An Auditor’s report on financial statements of a listed
company prepared in accordance with a fair presentation framework
• Illustration 2: An Auditor’s report on consolidated financial statements of a
listed company prepared in accordance with a fair presentation framework
• Illustration 3: An Auditor’s report on financial statements of an unlisted
Company prepared in accordance with a fair presentation framework
• Illustration 4: An Auditor’s report on financial statements of a non-corporate
entity prepared in accordance with a fair presentation framework
• Illustration 5: An Auditor’s report on financial statements of a non-corporate
entity prepared in accordance with a general purpose compliance
framework
Illustration 1 – Auditor’s Report on Financial Statements of a Listed

Company Prepared in Accordance with a Fair Presentation Framework
For purposes of this illustrative auditor’s report, the following circumstances are
assumed:
• Audit of a complete set of financial statements of a listed company
(registered under the Companies Act, 2013) using a fair presentation
framework. The audit is not a group audit (i.e., SA 600 does not apply).
• The financial statements are prepared by management of the company in
accordance with the accounting standards prescribed under section 133 of
the Companies Act, 2013.
• The terms of the audit engagement reflect the description of management’s
responsibility for the financial statements in SA 210.
• The auditor has concluded an unmodified (i.e., “clean”) opinion is
appropriate based on the audit evidence obtained.
• The relevant ethical requirements that apply to the audit comprise the Code
of Ethics issued by ICAI together with the other relevant ethical
requirements relating to the audit and the auditor refers to both.
• Based on the audit evidence obtained, the auditor has concluded that a
material uncertainty does not exist related to events or conditions that may
cast significant doubt on the company’s ability to continue as a going
concern in accordance with SA 570(Revised).
• Key audit matters have been communicated in accordance with SA 701.
• The auditor has obtained all of the other information prior to the date of the
auditor’s report and has not identified a material misstatement of the other
information .
• Those responsible for oversight of the financial statements differ from those
responsible for the preparation of the financial statements.
• In addition to the audit of the financial statements, the auditor has other
reporting responsibilities required under the Companies Act, 2013.
INDEPENDENT AUDITOR’S REPORT

To the Members of ABC Company Limited
SA 700 (Revised) 854

Report on the Audit of the Standalone Financial Statements

Opinion
We have audited the standalone financial statements of ABC Company Limited
(“the Company”), which comprise the balance sheet as at 31st March 20XX, and
the statement of profit and loss, (statement of changes in equity)37 and statement
of cash flows for the year then ended, and notes to the financial statements,
including a summary of significant accounting policies and other explanatory
information [in which are included the Returns for the year ended on that date
audited by the branch auditors of the Company’s branches located at (location of
branches)]38.
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid standalone financial statements give the
information required by the Companies Act, 2013 in the manner so required and
give a true and fair view in conformity with the accounting principles generally
accepted in India, of the state of affairs of the Company as at March 31, 20XX,
and its profit/loss, (changes in equity)39 and its cash flows for the year ended on
that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs)
specified under section 143(10) of the Companies Act, 2013. Our responsibilities
under those Standards are further described in the Auditor’s Responsibilities for
the Audit of the Financial Statements section of our report. We are independent
of the Company in accordance with the Code of Ethics issued by the Institute of
Chartered Accountants of India together with the ethical requirements that are
relevant to our audit of the financial statements under the provisions of the
Companies Act, 2013 and the Rules thereunder, and we have fulfilled our other
ethical responsibilities in accordance with these requirements and the Code of
Ethics. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of
most significance in our audit of the financial statements of the current period.
These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
37 Where applicable.
855 SA 700 (Revised)

[Description of each key audit matter in accordance with SA 701.]

Other Information [or another title if appropriate such as “Information
Other than the Financial Statements and Auditor’s Report Thereon”]
[Reporting in accordance with the reporting requirements in SA 720 (Revised) –
see Illustration 1 in Appendix 2 of SA 720 (Revised).]
Responsibilities of Management and Those Charged with Governance for
the Standalone Financial Statements
The Company’s Board of Directors is responsible for the matters stated in
section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the
preparation of these standalone financial statements that give a true and fair
view of the financial position, financial performance, (changes in equity)40 and
cash flows of the Company in accordance with the accounting principles
generally accepted in India, including the accounting Standards specified under
section 133 of the Act. This responsibility also includes maintenance of adequate
accounting records in accordance with the provisions of the Act for safeguarding
of the assets of the Company and for preventing and detecting frauds and other
irregularities; selection and application of appropriate accounting policies; making
judgments and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls, that
were operating effectively for ensuring the accuracy and completeness of the
accounting records, relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of Directors is responsible for
assessing the Company’s ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going concern basis
of accounting unless the Board of Directors either intends to liquidate the
Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Company’s
financial reporting process.
Our objectives are to obtain reasonable assurance about whether the financial
or error, and to issue an auditor’s report that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with SAs will always detect a material misstatement

when it exists. Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of these financial
statements.
Paragraph 41(b) of this SA explains that the shaded material below can be
located in an Appendix to the auditor’s report. Paragraph 41(c) explains that
when law, regulation or applicable auditing standards expressly permit, reference
can be made to a website of an appropriate authority that contains the
description of the auditor’s responsibilities, rather than including this material in
the auditor’s report, provided that the description on the website addresses, and
is not inconsistent with, the description of the auditor’s responsibilities below.
As part of an audit in accordance with SAs, we exercise professional judgment
and maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial
statements, whether due to fraud or error, design and perform audit
procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one
resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to
design audit procedures that are appropriate in the circumstances. Under
section 143(3)(i) of the Companies Act, 2013, we are also responsible for
expressing our opinion on whether the company has adequate internal
financial controls system in place and the operating effectiveness of such
controls.
• Evaluate the appropriateness of accounting policies used and the
reasonableness of accounting estimates and related disclosures made by
management.
• Conclude on the appropriateness of management’s use of the going
concern basis of accounting and, based on the audit evidence obtained,
whether a material uncertainty exists related to events or conditions that
may cast significant doubt on the Company’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required
to draw attention in our auditor’s report to the related disclosures in the
financial statements or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditor’s report. However, future events or conditions may
cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial

statements, including the disclosures, and whether the financial statements
represent the underlying transactions and events in a manner that achieves
fair presentation.
We communicate with those charged with governance regarding, among other
matters, the planned scope and timing of the audit and significant audit findings,
including any significant deficiencies in internal control that we identify during our
audit.
We also provide those charged with governance with a statement that we have
complied with relevant ethical requirements regarding independence, and to
communicate with them all relationships and other matters that may reasonably
be thought to bear on our independence, and where applicable, related
safeguards.
From the matters communicated with those charged with governance, we
determine those matters that were of most significance in the audit of the
financial statements of the current period and are therefore the key audit matters.
We describe these matters in our auditor’s report unless law or regulation
precludes public disclosure about the matter or when, in extremely rare
circumstances, we determine that a matter should not be communicated in our
report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
Other Matter
We did not audit the financial statements/ information of ………………. (number)
branches included in the standalone financial statements of the Company whose
financial statements/financial information reflect total assets of Rs. ……. as at
31st March 20XX and total revenue of Rs. ………for the year ended on that date,
as considered in the standalone financial statements. The financial
statements/information of these branches have been audited by the branch
auditors whose reports have been furnished to us, and our opinion in so far as it
relates to the amounts and disclosures included in respect of branches, is based
solely on the report of such branch auditors.
Our opinion is not modified in respect of this matter.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”),
issued by the Central Government of India in terms of sub-section (11) of section
143 of the Companies Act, 2013, we give in the Annexure a statement on the
matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

2. As required by Section 143(3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to
the best of our knowledge and belief were necessary for the purposes of our
audit.
(b) In our opinion, proper books of account as required by law have been kept
by the Company so far as it appears from our examination of those books
[and proper returns adequate for the purposes of our audit have been
received from the branches not visited by us.41]
(c) [The reports on the accounts of the branch offices of the Company audited
under Section 143(8) of the Act by branch auditors have been sent to us and
have been properly dealt with by us in preparing this report42.]
(d) The Balance Sheet, the Statement of Profit and Loss, (the Statement of
Changes in Equity)43 and the Cash Flow Statement dealt with by this Report
are in agreement with the books of account [and with the returns received
from the branches not visited by us44].
(e) In our opinion, the aforesaid standalone financial statements comply with the
Accounting Standards specified under Section 133 of the Act, read with Rule
7 of the Companies (Accounts) Rules, 2014.
(f) On the basis of the written representations received from the directors as on
31st March, 20XX taken on record by the Board of Directors, none of the
directors is disqualified as on 31st March, 20XX from being appointed as a
director in terms of Section 164(2) of the Act.
(g) With respect to the adequacy of the internal financial controls over financial
reporting of the Company and the operating effectiveness of such controls,
refer to our separate Report in “Annexure A”.
(h) With respect to the other matters to be included in the Auditor’s Report in
accordance with Rule 11 of the Companies (Audit and Auditors) Rules,
2014, in our opinion and to the best of our information and according to the
explanations given to us:
i.The Company has disclosed the impact of pending litigations on its financial
position in its financial statements – Refer Note XX to the financial
43
Where applicable.

statements; [or the Company does not have any pending litigations
which would impact its financial position45]
ii.The Company has made provision, as required under the applicable law or
accounting standards, for material foreseeable losses, if any, on long-
term contracts including derivative contracts – Refer Note XX to the
financial statements; [or the Company did not have any long-term
contracts including derivative contracts for which there were any
material foreseeable losses.46]
iii.There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company {or, following are the instances of delay in transferring
amounts, required to be transferred, to the Investor Education and
Protection Fund by the Company or there were no amounts which
were required to be transferred to the Investor Education and
Protection Fund by the Company47}.
For XYZ & Co
Chartered Accountants
(Firm’s Registration No.)
Signature
(Name of the Member Signing the Audit Report)
(Designation48)
(Membership No.)
Place of Signature:
Date:
45
As may be applicable.
46
47
48
Partner or Proprietor, as the case may be.

Illustration 2 – Auditor’s Report on Consolidated Financial Statements of a

Listed Company Prepared in Accordance with a Fair Presentation
Framework
assumed:
• Audit of a complete set of consolidated financial statements of a listed
company (registered under the Companies Act, 2013) using a fair
presentation framework. The audit is a group audit of an entity with
subsidiaries (i.e., SA 600 applies).
• The consolidated financial statements are prepared by management of the
company in accordance with the Accounting Standards prescribed under
section 133 of the Companies Act, 2013 (a general purpose framework).
responsibility for the consolidated financial statements in SA 210.
• The relevant ethical requirements that apply to the audit are the ICAI’s
Code of Ethics and the relevant provisions of the Companies Act, 2013.
• Based on the audit evidence obtained, the principal auditor has concluded
that a material uncertainty does not exist related to events or conditions
that may cast significant doubt on the company’s ability to continue as a
going concern in accordance with SA 570 (Revised).
• Key audit matters have been communicated in accordance with SA 701.
• The auditor has obtained all of the other information prior to the date of
information.
• Those responsible for oversight of the consolidated financial statements
differ from those responsible for the preparation of the consolidated
• In addition to the audit of the consolidated financial statements, the
principal auditor has other reporting responsibilities required under the
Companies Act, 2013.


Report on the Audit of the Consolidated Financial Statements
Opinion
We have audited the accompanying consolidated financial statements of ABC
Company Limited (hereinafter referred to as the ‘Holding Company”) and its
subsidiaries (Holding Company and its subsidiaries together referred to as “the
Group”), its associates and jointly controlled entities, which comprise the
consolidated Balance Sheet as at March 31, 20XX, and the consolidated
statement of Profit and Loss, (the consolidated statement of changes in equity)49
and the consolidated cash flows Statement for the year then ended, and notes to
the consolidated financial statements, including a summary of significant
accounting policies and other explanatory information (hereinafter referred to as
“the consolidated financial statements”).
explanations given to us, the aforesaid consolidated financial statements give the
accepted in India, of the consolidated state of affairs of the Group, its associates
and jointly controlled entities as at March 31, 20XX, of consolidated profit/loss,
(consolidated changes in equity)50 and its consolidated cash flows for the year
then ended.
Basis for Opinion
the Audit of the Consolidated Financial Statements section of our report. We are
independent of the Group, its associates and jointly controlled entities in
accordance with the ethical requirements that are relevant to our audit of the
consolidated financial statements in India in terms of the Code of Ethics issued
by ICAI and the relevant provisions of the Companies Act, 2013, and we have
fulfilled our other ethical responsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate
to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of
most significance in our audit of the consolidated financial statements of the

current period. These matters were addressed in the context of our audit of the
consolidated financial statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on these matters.
[Description of each key audit matter in accordance with SA 701.]
the Consolidated Financial Statements
The Holding Company’s Board of Directors is responsible for the preparation and
presentation of these consolidated financial statements in term of the
requirements of the Companies Act, 2013 (the Act) that give a true and fair view
of the consolidated financial position, consolidated financial performance and
consolidated cash flows of the Group including its associates and jointly
controlled entities in accordance with the accounting principles generally
accepted in India, including the Accounting Standards specified under section
133 of the Act. The respective Board of Directors of the companies included in
the Group and of its associates and jointly controlled entities are responsible for
maintenance of adequate accounting records in accordance with the provisions
of the Act for safeguarding the assets of the Group and for preventing and
detecting frauds and other irregularities; selection and application of appropriate
accounting policies; making judgments and estimates that are reasonable and
prudent; and the design, implementation and maintenance of adequate internal
financial controls, that were operating effectively for ensuring accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the financial statements that give a true and fair view and are
free from material misstatement, whether due to fraud or error, which have been
used for the purpose of preparation of the consolidated financial statements by
the Directors of the Holding Company, as aforesaid.
In preparing the consolidated financial statements, the respective Board of
Directors of the companies included in the Group and of its associates and jointly
controlled entities are responsible for assessing the ability of the Group and of its
associates and jointly controlled entities to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the Board of Directors either intends to
liquidate the Group or to cease operations, or has no realistic alternative but to
do so.
The respective Board of Directors of the companies included in the Group and of

its associates and jointly controlled entities are responsible for overseeing the
financial reporting process of the Group and of its associates and jointly
controlled entities.
Auditor’s Responsibilities for the Audit of the Consolidated Financial
Statements
Our objectives are to obtain reasonable assurance about whether the
consolidated financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance with SAs will always
detect a material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users
taken on the basis of these consolidated financial statements.
when law, regulation or the applicable auditing standards expressly permit,
reference can be made to a website of an appropriate authority that contains the
• Identify and assess the risks of material misstatement of the consolidated
financial statements, whether due to fraud or error, design and perform
audit procedures responsive to those risks, and obtain audit evidence that
is sufficient and appropriate to provide a basis for our opinion. The risk of
not detecting a material misstatement resulting from fraud is higher than for
one resulting from error, as fraud may involve collusion, forgery, intentional
controls.
management.


may cast significant doubt on the ability of the Group and its associates and
jointly controlled entities to continue as a going concern. If we conclude that
a material uncertainty exists, we are required to draw attention in our
auditor’s report to the related disclosures in the consolidated financial
statements or, if such disclosures are inadequate, to modify our opinion.
Our conclusions are based on the audit evidence obtained up to the date of
our auditor’s report. However, future events or conditions may cause the
Group and its associates and jointly controlled entities to cease to continue
as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated
financial statements, including the disclosures, and whether the
consolidated financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial
information of the entities or business activities within the Group and its
associates and jointly controlled entities to express an opinion on the
consolidated financial statements. We are responsible for the direction,
supervision and performance of the audit of the financial statements of
such entities included in the consolidated financial statements of which we
are the independent auditors. For the other entities included in the
consolidated financial statements, which have been audited by other
auditors, such other auditors remain responsible for the direction,
supervision and performance of the audits carried out by them. We remain
solely responsible for our audit opinion.
We communicate with those charged with governance of the Holding Company
and such other entities included in the consolidated financial statements of which
we are the independent auditors regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify during our audit.
safeguards.
From the matters communicated with those charged with governance, we
determine those matters that were of most significance in the audit of the

consolidated financial statements of the current period and are therefore the key
audit matters. We describe these matters in our auditor’s report unless law or
regulation precludes public disclosure about the matter or when, in extremely
rare circumstances, we determine that a matter should not be communicated in
our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
Other Matters
(a) We did not audit the financial statements / financial information of ______
subsidiaries, and ______ jointly controlled entities, whose financial
statements / financial information reflect total assets of Rs.______ as at 31st
March, 20XX, total revenues of Rs._______ and net cash flows amounting
to Rs.______ for the year ended on that date, as considered in the
consolidated financial statements. The consolidated financial statements
also include the Group’s share of net profit/loss of Rs. _____ for the year
ended 31st March, 20XX, as considered in the consolidated financial
statements, in respect of ____associates, whose financial statements /
financial information have not been audited by us. These financial
statements / financial information have been audited by other auditors
whose reports have been furnished to us by the Management and our
opinion on the consolidated financial statements, in so far as it relates to the
amounts and disclosures included in respect of these subsidiaries, jointly
controlled entities and associates, and our report in terms of sub-section (3)
of Section 143 of the Act, in so far as it relates to the aforesaid subsidiaries,
jointly controlled entities and associates, is based solely on the reports of the
other auditors.
(b) We did not audit the financial statements / financial information of ______
subsidiaries and ______ jointly controlled entities, whose financial
statements / financial information reflect total assets of Rs.______ as at 31st
March, 20XX, total revenues of Rs._______ and net cash flows amounting
to Rs.______ for the year ended on that date, as considered in the
consolidated financial statements. The consolidated financial statements
also include the Group’s share of net profit/loss of Rs. _____ for the year
ended 31st March, 20XX, as considered in the consolidated financial
statements, in respect of ____associates, whose financial statements /
financial information have not been audited by us. These financial
statements / financial information are unaudited and have been furnished to
us by the Management and our opinion on the consolidated financial
statements, in so far as it relates to the amounts and disclosures included in
respect of these subsidiaries, jointly controlled entities and associates, and
our report in terms of sub-section (3) of Section 143 of the Act in so far as it

relates to the aforesaid subsidiaries, jointly controlled entities and

associates, is based solely on such unaudited financial statements / financial
information. In our opinion and according to the information and
explanations given to us by the Management, these financial statements /
financial information are not material to the Group.
Our opinion on the consolidated financial statements, and our report on Other
Legal and Regulatory Requirements below, is not modified in respect of the
above matters with respect to our reliance on the work done and the reports of
the other auditors and the financial statements / financial information certified by
the Management.
As required by Section 143(3) of the Act, we report, to the extent applicable, that:
(a) We have sought and obtained all the information and explanations which to
the best of our knowledge and belief were necessary for the purposes of our
audit of the aforesaid consolidated financial statements.
(b) In our opinion, proper books of account as required by law relating to
preparation of the aforesaid consolidated financial statements have been
kept so far as it appears from our examination of those books and the
reports of the other auditors.
(c) The Consolidated Balance Sheet, the Consolidated Statement of Profit and
Loss, (the consolidated Statement of Changes in Equity)51 and the
Consolidated Cash Flow Statement dealt with by this Report are in
agreement with the relevant books of account maintained for the purpose of
preparation of the consolidated financial statements.
(d) In our opinion, the aforesaid consolidated financial statements comply with
the Accounting Standards specified under Section 133 of the Act read with
Rule 7 of the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the directors of the
Holding Company as on 31st March, 20XX taken on record by the Board of
Directors of the Holding Company and the reports of the statutory auditors of
its subsidiary companies, associate companies and jointly controlled
companies incorporated in India, none of the directors of the Group
companies, its associate companies and jointly controlled companies
incorporated in India is disqualified as on 31st March, 20XX from being
appointed as a director in terms of Section 164(2) of the Act.
51
Where applicable.

(f) With respect to the adequacy of internal financial controls over financial
reporting of the Group and the operating effectiveness of such controls, refer
to our separate report in Annexure.
(g) With respect to the other matters to be included in the Auditor’s Report in
accordance with Rule 11 of the Companies (Audit and Auditor’s) Rules,
i. The consolidated financial statements disclose the impact of pending
litigations on the consolidated financial position of the Group, its
associates and jointly controlled entities – Refer Note XX to the
consolidated financial statements.
Or
There were no pending litigations which would impact the
consolidated financial position of the Group, its associates and jointly
controlled entities.52
ii. Provision has been made in the consolidated financial statements, as
required under the applicable law or accounting standards, for
material foreseeable losses, if any, on long-term contracts including
derivative contracts – Refer (a) Note XX to the consolidated financial
statements in respect of such items as it relates to the Group, its
associates and jointly controlled entities and (b) the Group’s share of
net profit/loss in respect of its associates.
Or
The Group, its associates and jointly controlled entities did not have
any material foreseeable losses on long-term contracts including
derivative contracts.53
iii. There has been no delay in transferring amounts, required to be
Holding Company and its subsidiary companies, associate companies
and jointly controlled companies incorporated in India.
Or
Following are the instances of delay in transferring amounts, required
to be transferred, to the Investor Education and Protection Fund by
52 As may be applicable.

the Holding Company, and its subsidiary companies, associate

companies and jointly controlled companies incorporated in India54.
Or
There were no amounts which were required to be transferred to the
Investor Education and Protection Fund by the Holding Company, and
its subsidiary companies, associate companies and jointly controlled
companies incorporated in India55.
For XYZ & Co
Signature
(Designation56)
(Membership No.)
Place of Signature:
Date:
56 Partner or Proprietor

Illustration 3 – Auditor’s Report on Financial Statements of an Unlisted

Company Prepared in Accordance with a Fair Presentation Framework
assumed:
• Audit of a complete set of financial statements of an unlisted company
(registered under the Companies Act, 2013) using a fair presentation
framework. The audit is not a group audit (i.e., SA 600 does not apply).
• The financial statements are prepared by management of the company in
accordance with the accounting standards prescribed under section 133 of
the Companies Act, 2013.
• The relevant ethical requirements that apply to the audit comprise the Code
of Ethics issued by ICAI together with the other relevant ethical
requirements relating to the audit and the auditor refers to both.
cast significant doubt on the company’s ability to continue as a going
concern in accordance with SA 570 (Revised).
• The auditor is not required, and has otherwise not decided, to communicate
key audit matters in accordance with SA 701.
• The auditor has obtained all of the other information prior to the date of the
information.
• In addition to the audit of the financial statements, the auditor has other
reporting responsibilities required under the Companies Act, 2013.

Report on the Audit of the Standalone Financial Statements
Opinion
We have audited the standalone financial statements of ABC Company Limited
(“the Company”), which comprise the balance sheet as at 31st March 20XX, and

the statement of Profit and Loss, (statement of changes in equity)57 and

statement of cash flows for the year then ended, and notes to the financial
statements, including a summary of significant accounting policies and other
explanatory information [in which are included the Returns for the year ended on
that date audited by the branch auditors of the Company’s branches located at
(location of branches)]58.
explanations given to us, the aforesaid standalone financial statements give the
accepted in India, of the state of affairs of the Company as at March 31, 20XX,
and its profit/loss, (changes in equity)59 and its cash flows for the year ended on
that date.
Basis for Opinion
the Audit of the Financial Statements section of our report. We are independent
of the Company in accordance with the Code of Ethics issued by the Institute of
Chartered Accountants of India together with the ethical requirements that are
relevant to our audit of the financial statements under the provisions of the
Companies Act, 2013 and the Rules thereunder, and we have fulfilled our other
ethical responsibilities in accordance with these requirements and the Code of
Ethics. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
the Standalone Financial Statements
The Company’s Board of Directors is responsible for the matters stated in
section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the
preparation of these standalone financial statements that give a true and fair
59 Where applicable

view of the financial position, financial performance, (changes in equity)60 and

cash flows of the Company in accordance with the accounting principles
generally accepted in India, including the accounting Standards specified under
section 133 of the Act. This responsibility also includes maintenance of adequate
accounting records in accordance with the provisions of the Act for safeguarding
of the assets of the Company and for preventing and detecting frauds and other
irregularities; selection and application of appropriate accounting policies; making
judgments and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls, that
were operating effectively for ensuring the accuracy and completeness of the
accounting records, relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
In preparing the financial statements, the Board of Directors is responsible for
assessing the Company’s ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going concern basis
of accounting unless the Board of Directors either intends to liquidate the
Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the company’s
statements.
when law, regulation or the applicable auditing standards expressly permit,
reference can be made to a website of an appropriate authority that contains the


detecting a material misstatement resulting from fraud is higher than for one
resulting from error, as fraud may involve collusion, forgery, intentional
controls.
management.
• Conclude on the appropriateness of management’s use of the going concern
basis of accounting and, based on the audit evidence obtained, whether a
material uncertainty exists related to events or conditions that may cast
significant doubt on the Company’s ability to continue as a going concern. If
we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the financial
statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However, future events or conditions may cause the
Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial
statements, including the disclosures, and whether the financial statements
represent the underlying transactions and events in a manner that achieves
fair presentation.
audit.

safeguards.
Other Matter
We did not audit the financial statements/ information of ………………. (number)
branches included in the standalone financial statements of the company whose
financial statements/financial information reflect total assets of Rs. ……..as at
31st March 20XX and total revenue of Rs. ……for the year ended on that date, as
considered in the standalone financial statements. The financial
statements/information of these branches have been audited by the branch
auditors whose reports have been furnished to us, and our opinion in so far as it
relates to the amounts and disclosures included in respect of branches, is based
solely on the report of such branch auditors.
Our opinion is not modified in respect of this matter.
1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”),
issued by the Central Government of India in terms of sub-section (11) of section
143 of the Companies Act, 2013, we give in the Annexure a statement on the
matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2. As required by Section 143(3) of the Act, we report that:
a) We have sought and obtained all the information and explanations which to
the best of our knowledge and belief were necessary for the purposes of
our audit.
(b) In our opinion, proper books of account as required by law have been kept
by the Company so far as it appears from our examination of those books
[and proper returns adequate for the purposes of our audit have been
received from the branches not visited by us.61]
(c) [The reports on the accounts of the branch offices of the Company audited
under Section 143(8) of the Act by branch auditors have been sent to us
and have been properly dealt with by us in preparing this report62.]
(d) The Balance Sheet, the Statement of Profit and Loss, (the Statement of
Changes in Equity)63 and the Cash Flow Statement dealt with by this Report
are in agreement with the books of account [and with the returns received
63
Where applicable.

from the branches not visited by us64].

(e) In our opinion, the aforesaid standalone financial statements comply with
the Accounting Standards specified under Section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014.
(f) On the basis of the written representations received from the directors as
on 31st March, 20XX taken on record by the Board of Directors, none of the
directors is disqualified as on 31st March, 20XX from being appointed as a
director in terms of Section 164(2) of the Act.
(g) With respect to the adequacy of the internal financial controls over financial
reporting of the Company and the operating effectiveness of such controls,
refer to our separate Report in “Annexure A”.
(h) With respect to the other matters to be included in the Auditor’s Report in
accordance with Rule 11 of the Companies (Audit and Auditors) Rules,
i.The Company has disclosed the impact of pending litigations on its financial
position in its financial statements – Refer Note XX to the financial
statements; [or the Company does not have any pending litigations
which would impact its financial position65]
ii.The Company has made provision, as required under the applicable law or
accounting standards, for material foreseeable losses, if any, on long-
term contracts including derivative contracts – Refer Note XX to the
financial statements; [or the Company did not have any long-term
contracts including derivative contracts for which there were any
material foreseeable losses.66]
iii.There has been no delay in transferring amounts, required to be
Company {or, following are the instances of delay in transferring
amounts, required to be transferred, to the Investor Education and
Protection Fund by the Company or there were no amounts which
were required to be transferred to the Investor Education and
Protection Fund by the Company67}.

For XYZ & Co

Signature
(Designation68)
(Membership No.)
Place of Signature:
Date:
68 Partner or Proprietor, as the case may be

Illustration 4 – Auditor’s Report on Financial Statements of a Non-

Corporate Entity Prepared in Accordance with a Fair Presentation
Framework
assumed:
• Audit of a complete set of financial statements of a non-corporate entity
using a fair presentation framework. The audit is not a group audit (i.e., SA
600 does not apply).
• The financial statements are prepared by management of the entity in
accordance with the Accounting Standards issued by the Institute of
Chartered Accountants of India.
• The relevant ethical requirements that apply to the audit are the Code of
69
Ethics issued by ICAI .
cast significant doubt on the entity’s ability to continue as a going concern
in accordance with SA 570 (Revised).
• The auditor has no other reporting responsibilities required under local law.
• The auditor elects to refer to the description of the auditor’s responsibility
included on a website of an appropriate authority.
To the Partners of ABC & Associates [or Other Appropriate Addressee]
69Specify any applicable ethical requirements under the relevant laws or regulations applicable to
the entity.

Opinion
We have audited the financial statements of ABC & Associates (the entity), which
comprise the balance sheet as at March 31st 20XX, and the profit and loss
account, (and statement of cash flows)70 for the year then ended, and notes to
the financial statements, including a summary of significant accounting policies.
In our opinion, the accompanying financial statements give a true and fair view of
the financial position of the entity as at March 31, 20XX, and of its financial
performance (and its cash flows)71 for the year then ended in accordance with
the Accounting Standards issued by the Institute of Chartered Accountants of
India (ICAI).
Basis for Opinion
issued by ICAI. Our responsibilities under those standards are further described
in the Auditor’s Responsibilities for the Audit of the Financial Statements section
of our report. We are independent of the entity in accordance with the Code of
Ethics issued by ICAI and we have fulfilled our other ethical responsibilities in
accordance with the Code of Ethics. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
the Financial Statements72
Management is responsible for the preparation of these financial statements that
give a true and fair view of the state of affairs, results of operations and cash
flows of the entity in accordance with the accounting principles generally
accepted in India. This responsibility includes the design, implementation and
maintenance of internal control relevant to the preparation and presentation of
the financial statements that give a true and fair view and are free from material
In preparing the financial statements, management is responsible for assessing
the entity’s ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis of
accounting unless management either intends to liquidate the entity or to cease
operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the entity’s
71 Where applicable
72 Or other terms that are appropriate in the context of the legal framework of the particular entity.


statements.
A further description of the auditor’s responsibilities for the audit of the financial
statements is located at [Organization’s] website at: [website link]. This
description forms part of our auditor’s report.
For XYZ & Co

Signature
73
(Designation )
(Membership No.)
Place of Signature:
Date:
73 Partner or Proprietor, as the case may be

Illustration 5 – Auditor’s Report on Financial Statements of a Non-

Corporate Entity Prepared in Accordance with a General Purpose
Compliance Framework
assumed:
• Audit of a complete set of financial statements of a non-corporate entity,
required by law or regulation. The audit is not a group audit (i.e., SA 600
does not apply).
• The financial statements are prepared by management of the entity in
accordance with the Financial Reporting Framework (XYZ Laws) of
Jurisdiction X (that is, a financial reporting framework, encompassing law or
regulation, designed to meet the common financial information needs of a
wide range of users, but which is not a fair presentation framework).
• The relevant ethical requirements that apply to the audit are the Code of
Ethics issued by ICAI74.
cast significant doubt on the entity’s ability to continue as a going concern
in accordance with SA 570 (Revised).
• The auditor has no other reporting responsibilities required under local law.
[Appropriate Addressee]
Opinion
We have audited the financial statements of ABC & Associates (the entity), which
comprise the balance sheet as at March 31, 20X1, and the Profit and Loss
74
Specify any applicable ethical requirements under the relevant laws or regulations applicable to
the entity.

Account (and the cash flow statement)75 for the year then ended, and notes to
the financial statements, including a summary of significant accounting policies.
In our opinion, the accompanying financial statements of the entity are prepared,
in all material respects, in accordance with XYZ Laws.
Basis for Opinion
issued by ICAI. Our responsibilities under those Standards are further described
in the Auditor’s Responsibilities for the Audit of the Financial Statements section
of our report. We are independent of the entity in accordance with the Code of
Ethics issued by ICAI and we have fulfilled our other ethical responsibilities in
accordance with the Code of Ethics. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
the Financial Statements76
Management is responsible for the preparation of the financial statements in
accordance with XYZ Laws and for such internal control as management
determines is necessary to enable the preparation of financial statements that
are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing
the entity’s ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis of
accounting unless management either intends to liquidate the entity or to cease
operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the entity’s
statements.
76 Or other terms that are appropriate in the context of the legal framework of the particular entity.

when law, regulation or applicable auditing standards expressly permit, reference
can be made to a website of an appropriate authority that contains the
detecting a material misstatement resulting from fraud is higher than for
one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal
control.
design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the
entity’s internal control.77
management.
may cast significant doubt on the entity’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required
to draw attention in our auditor’s report to the related disclosures in the
financial statements or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditor’s report. However, future events or conditions may
cause the entity to cease to continue as a going concern.
77
This sentence would be modified, as appropriate, in circumstances when the auditor also has
responsibility to issue an opinion on the effectiveness of internal control in conjunction with the
audit of the financial statements.

audit.
safeguards.
For XYZ & Co
Signature
(Designation78)
(Membership No.)
Place of Signature:
Date:
78 Partner or Proprietor, as the case may be.

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SA 700(Revised)*

Forming an Opinion and Reporting on

* Issued in May 2016.

Standard on Auditing (SA) 700(Revised), “Forming an Opinion and

respects, in accordance with the applicable financial reporting framework.7

appropriate audit evidence has been obtained;11

underlying transactions and events in a manner that achieves fair

report of an independent auditor. (Ref: Para. A15)

17 SA 600, Using the Work of Another Auditor.

regarding independence and communicate with them all relationships and

Date of the Auditor’s Report

requirements in that SA.19 (Ref: Para. A64–A67)

financial statements as a whole are materially misstated include the following:

A7. A description of the applicable financial reporting framework that contains

those specifically required by the framework or, in extremely rare circumstances,

applicable financial reporting framework, specifying the date or period covered

prepared in accordance with one of the applicable financial reporting

A29. The identification of the applicable relevant ethical requirements increases

27 SA 210, paragraphs 9 and A21.

A39. SA 200 explains the premise, relating to the responsibilities of

30 SA 200, paragraph 13(j).

Description of materiality (Ref: Para. 38(c))

Auditor’s Responsibilities for the Audit of the Financial

Auditor’s Responsibilities for the Audit of the Financial

financial statements. In case of some entities, however, the approval process

36 SA 210, paragraph 21.

in a supplementary report, which may include information that is consistent with

another financial reporting framework, the auditor may consider this to be

Illustration 1 – Auditor’s Report on Financial Statements of a Listed

INDEPENDENT AUDITOR’S REPORT

SA 700 (Revised) 854

Report on the Audit of the Standalone Financial Statements

855 SA 700 (Revised)

[Description of each key audit matter in accordance with SA 701.]

SA 700 (Revised) 856

857 SA 700 (Revised)

• Evaluate the overall presentation, structure and content of the financial

SA 700 (Revised) 858

2. As required by Section 143(3) of the Act, we report that:

859 SA 700 (Revised)

SA 700 (Revised) 860

Illustration 2 – Auditor’s Report on Consolidated Financial Statements of a

861 SA 700 (Revised)

INDEPENDENT AUDITOR’S REPORT

SA 700 (Revised) 862

863 SA 700 (Revised)

SA 700 (Revised) 864

• Conclude on the appropriateness of management’s use of the going

865 SA 700 (Revised)

SA 700 (Revised) 866

relates to the aforesaid subsidiaries, jointly controlled entities and

867 SA 700 (Revised)

SA 700 (Revised) 868

the Holding Company, and its subsidiary companies, associate

869 SA 700 (Revised)

Illustration 3 – Auditor’s Report on Financial Statements of an Unlisted

INDEPENDENT AUDITOR’S REPORT

SA 700 (Revised) 870

the statement of Profit and Loss, (statement of changes in equity)57 and