Appendix No. 11
to the Order of the Ministry of Finance of the Russian Federation of November 9, 2016 No. 207n
The International Standard of Audit (ISA) 701 "Informing on key questions of audit in audit opinion" should be considered together with MCA 200 "Main objectives of the independent auditor and carrying out audit according to International standards of audit".
1. This International Standard of Audit (ISA) establishes the auditor's obligations on informing on key questions of audit in audit opinion. It is intended to regulate judgment of the auditor concerning what it is necessary to inform in audit opinion on, and also form and content of such information.
2. The purpose of informing on key questions of audit is increase in information value of audit opinion by ensuring bigger transparency of the booked audit. Informing on key questions of audit provides the additional information to expected users of the financial reporting ("expected users") to help them to understand those questions which, according to professional judgment of the auditor, were the most significant for financial records audit for current period. Informing on key questions of audit also can be useful for studying by expected users of the organization and areas of the pro-audited financial reporting in which significant judgments of management (see the Items A1 - A 4) were applied.
3. Informing on key questions of audit in audit opinion can also provide to expected users basis for further interaction with the management and persons who are responsible for corporate management on the certain questions relating to the organization, the pro-audited financial reporting or the booked audit.
4. Informing on key questions of audit in audit opinion is performed in the context of the created auditor opinion on the financial reporting in general. Informing on key questions of audit in audit opinion does not substitute:
(a) information opened by management in the financial reporting according to requirements of the applicable concept of preparation of the financial reporting or in other cases necessary for providing fair presentation;
(b) expression by the auditor of the modified opinion when it is required in connection with circumstances of the specific audit engagement according to MCA 705 (reviewed) <1>;
<1> MCA 705 (reviewed) "The modified opinion in audit opinion".
(c) submission of information according to MCA 570 (reviewed) <1> in cases when there is essential uncertainty in connection with events or conditions from which considerable doubts in capability of the organization continuously can result to continue the activities; and also
<1> MCA 570 (reviewed) "Going concern", Items 22 - 23.
(d) is not the separate opinion expressed on separately taken questions (see the Items A5 - A 8).
5. This MSA is applied to audit of complete sets of general purpose financial statements of the organizations which securities are admitted to organized trading, and in circumstances when the auditor makes the decision to inform on key questions of audit in audit opinion. This standard is also applied in cases when the auditor give information on key questions of audit in audit opinion according to the law or the regulation <1>. However MCA 706 (reviewed) prohibits to the auditor to inform on key questions of audit in circumstances when the auditor refuses to express opinion on the financial reporting, except cases when such informing is required according to the law or the regulation <2>.
<1> MCA 700 (reviewed) "Forming of opinion and creation of the conclusion about the financial reporting", Items 30 - 31.
<2> MCA 705 (reviewed) Item 29.
6. This standard becomes effective concerning financial records audit for the periods which are coming to an end on December 15, 2016 or after this date.
7. The purpose of the auditor consists in determining key questions of audit and, having created opinion on the financial reporting, to inform on these questions, having described them in audit opinion.
8. For the purposes of International standards of audit the following term has the stated below value:
key questions of audit are questions which, according to professional judgment of the auditor, were the most significant for financial records audit for current period. Key questions of audit are chosen from among questions which were brought to the attention persons who are responsible for corporate management.
9. The auditor shall determine from among questions which were entrusted to data of persons who are responsible for corporate management, those questions which required special attention of the auditor when carrying out audit. Determining such questions, the auditor shall consider the following (see the Items A9 - A 18):
(a) areas of the increased estimated risk of essential misstatement of the reporting or significant risks revealed according to MCA 315 (reviewed) <1> (see the Items A19 - A 22);
<1> MCA 315 (reviewed) "Identification and risks assessment of essential misstatement by means of studying of the organization and its environment".
(b) significant judgments of the auditor concerning the areas of the financial reporting requiring application of significant judgments of management including estimative values which were determined as the uncertainty of assessment having high level (see the Items A23 - A 24);
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