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Reporting

The independent auditor’s report

1.1 Objectives of an auditor

The objectives of an auditor, in accordance with ISA 700 (Revised) Forming an
Opinion and Reporting on Financial Statements, are:

 to form an opinion on the financial statements based upon an evaluation of their
conclusions drawn from audit evidence.

 to express clearly that opinion through a written report.

The auditor should evaluate whether:

 the financial statements adequately disclose the significant accounting policies

 the accounting policies selected are consistently applied and appropriate

 accounting estimates are reasonable

 information is relevant, reliable, comparable and understandable

 the financial statements provide adequate disclosures to enable the users to
understand the effects of material transactions and events

 the terminology used is appropriate.

When the auditor concludes that the financial statements are prepared, in all material
respects, in accordance with the applicable financial reporting framework, i.e. give a
true and fair view, they issue an unmodified opinion in the auditor's report.

If there are no other matters which the auditor wishes to draw to the attention of the
users, they will issue an unmodified report.

Illustrations and further practice

Look at Illustration 1 in Chapter 10 for an example of an independent auditor’s
report.

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