All About Standards On Auditing (SA)

What are Standards on Auditing?
Standards on Auditing are the benchmarks by which the qualities of audit performance can be measured. In simple words, Standards on Auditing (SAs) are the standards which prescribe the way in which auditing should be conducted.

What are the relevance of Auditing and Assurance Standard Board (AASB) with reference to SAs?
AASB of ICAI plays a leading role in issuance of SAs in India. This board tries to integrate the SAs as far as possible, with the International Standards on Auditing.

Is it compulsory to follow the Standards on Auditing?
Yes, it is the duty of an auditor to follow the SAs, whenever an independent audit is carried on. If the auditor is unable to follow the Standards, he should mention the same in his audit report; otherwise he will be liable to disciplinary action under the Chartered Accountants Act of 1949.
 

Standards on Auditing

SA 200 - Overall Objectives of Independent Auditor and the conduct of an audit in accordance with the Standards of Auditing:
This SA establishes the independent auditor’s overall responsibilities when conducting an audit of the financial statements in accordance with the Standards on Auditing.
1. Click here for detailed notes on SA 200
2. Click here for detailed notes on SA 200

SA 210 - Agreeing the Terms of Audit Engagements:
This standard deals with the auditors responsibilities in agreeing the terms of audit engagement with management, and, where appropriate, those charged with governance. This SA establishes certain preconditions for an audit, responsibility for which rests with the management or those charged with governance.
1. SA 210 Detailed Notes
2. SA 210 Detailed Notes

SA 220 - Quality Control for an audit of Financial Statements:
This SA deals with the specific responsibilities of the auditor regarding quality control procedures for an audit of financial statements.
1. SA 220 Detailed Notes
2. SA 220 Detailed Notes

SA 230 - Audit Documentation:
This standard deals with the auditor’s responsibilities to prepare audit documentation for an audit of financial statements and deals with the requirements of timely preparation of audit documentation, documentation of the audit procedures performed and audit evidence obtained and assembly of the final audit file.
SA 230 Detailed Notes
SA 230 Summary Notes

SA 240 - The Auditors Responsibility relating to Fraud in an Audit of Financial Statements:
The standard adopts a risk-based approach to auditor’s responsibility relating to fraud in an audit of financial statements. It therefore, explains how the principles enunciated in SA 315 and SA 330 would be applied in case of consideration of fraud in an audit of financial statements.
1. SA 240 Detailed Notes
2. SA 240 Detailed Notes

SA 250 - Consideration of Laws and Regulations in an Audit of Financial Statements:
This standard deals with the auditor’s responsibility to consider laws and regulations when performing the audit of Financial Statements.
1. SA 250 Detailed Notes
2. SA 250 Detailed Notes

SA 260 - Communication with those charged with Governance:
This standard deals with the auditor’s responsibility to communicate with those charged with governance in relation to an audit of Financial Statements. This SA also describes the requirements regarding communication with those charged with governance and regarding the matter to e communicated and documentation required.
1. SA 260 Detailed Notes
2. SA 260 Detailed Notes

SA 265 - Communicating Deficiencies in Internal Control to those charged with governance and Management:
This SA defines the terms ‘Deficiency in Internal Control’ and ‘Significant Deficiency in Internal Control’ and deals with the aspects like determination of whether deficiencies in internal control have been identified, whether it is significant deficiencies in the internal control and communicating deficiencies in the internal control.
1. SA 265 Detailed Notes
2. SA 265 Detailed Notes

SA 299 - Responsibility of Joint Auditors:
This SA deals with the professional responsibilities which the auditors undertake in accepting appointments as joint auditors. This SA, inter alia, lays down that the joint auditors should, normally, by mutual discussion, divide the audit work among themselves.
1. SA 299 Detailed Notes
2. SA 299 Detailed Notes

SA 300 - Planning an Audit of Financial Statements:
This standard deals with the auditor’s responsibility to plan an audit of the Financial Statements. As per this SA, the objective of the auditor is to plan the audit so that it will be performed in an effective manner.
SA 300 Detailed Notes
SA 300 Summary Notes

SA 315 - Identifying and Assessing the Risk of Material Misstatement Through Understanding the Entity and its Environment:
The Standard deals with the auditor’s responsibility to obtain an understanding of the entity and its environment and using that understanding to identify and assess the risks of material misstatement at the financial statement level and the assertion level.
1. SA 315 Detailed Notes
2. SA 315 Detailed Notes

SA 320 - Materiality in Planning and Performing an Audit:
This standard deals with the auditor’s responsibility to apply the concept of materiality in planning and performing an audit of the Financial Statements and the requirements of determining materiality and performance materiality when planning the audit, revision as the audit progresses and documentation requirements.
1. SA 320 Detailed Notes
2. SA 320 Detailed Notes

SA 330 - The Auditor’s Responses to Assessed Risks:
This SA deals with the auditor’s responsibility to design and implement responses to the risks of material misstatement identified and assessed by the auditor in accordance with SA 315 at the financial statement level and assertion level.
1. SA 330 Detailed Notes
2. SA 330 Detailed Notes

SA 402 - Audit Considerations Relating to an Entity Using a Service Organisation:
This SA deals with the user auditor’s responsibility to obtain sufficient and appropriate audit evidence when a user entity uses the services of one or more service organisations. It deals with the aspects like obtaining and understanding the services provided by a service organisation, including internal control, responding to the assessed risks of material misstatement, Type 1 and Type 2 reports, frauds, etc.
1. SA 402 Detailed Notes
2. SA 402 Detailed Notes

SA 450 - Evaluation of Misstatements Identified during the Audit:
This SA deals with the auditor’s responsibility to evaluate the effect of identified misstatements on the audit and of uncorrected misstatements, if any, on the Financial Statements.
1. SA 450 Detailed Notes
2. SA 450 Detailed Notes

SA 500 - Audit Evidence:
This SA deals with the auditor’s responsibility to design and perform audit procedures to obtain sufficient appropriate audit evidence to be able to draw reasonable conclusions on which the auditor’s opinion should be based.
1. SA 500 Detailed Notes
2. SA 500 Detailed Notes

SA 501 - Audit Evidence- Special Consideration for Selected Items:
This Standard deals with specific considerations by the auditor in obtaining sufficient appropriate audit evidence in accordance with SA 330, SA 500 and other relevant SAs, with respect to certain aspects of inventory, litigation and claims involving the entity, and segment information in an audit of Financial Statements.
1. SA 501 Detailed Notes
2. SA 501 Detailed Notes

SA 505 - External Confirmations:
This Standard deals with the auditor’s use of external confirmation procedures to obtain audit evidence in accordance with the requirements of SA 330.
1. SA 505 Detailed Notes
2. SA 505 Detailed Notes

SA 510 - Initial Audit Engagements:
This Standard establishes the principles regarding audit of opening balances in case of initial engagements, i.e. when the financial statements are audited for the first time or when the financial statements for the preceding period were audited by another auditor.
1. SA 510 Detailed Notes
2. SA 510 Detailed Notes

SA 520 - Analytical Procedures:
This Standard deals with the auditor’s use of analytical procedures as substantive procedures, and as procedures near the end of the audit that assist the auditor when forming an overall conclusion on the financial statements.
1. SA 520 Detailed Notes
2. SA 520 Detailed Notes

SA 530 - Audit Sampling:
This Standard applies when the auditor has decided to use audit sampling in performing audit procedures. It also deals with the auditor’s use of statistical and non-statistical sampling when designing and selecting the audit sample, performing tests of controls and tests of details, and evaluating the results from the sample.
1. SA 530 Detailed Notes
2. SA 530 Detailed Notes

SA 540 - Auditing Accounting Estimates, Including Fair Value Accounting Estimates, and Related Disclosures:
This Standard deals with the auditor’s responsibility regarding accounting estimates, including fair value accounting estimates, and related disclosures in an audit of financial statements. Specifically, it expands on how SA 315 and SA 330 and other SAs are to be applied in relation to accounting estimates.
1. SA 540 Detailed Notes
2. SA 540 Detailed Notes

SA 550 - Related Parties:
This Standard deals with the auditor’s responsibility regarding related parties relationship and transactions when performing an audit of Financial Statements.
1. SA 550 Detailed Notes
2. SA 550 Detailed Notes

SA 560 - Subsequent Events:
This Standard deals with the auditor’s responsibility relating to subsequent events in an audit of Financial Statements. It also deals with the events occurring between the date of the financial statements and the date of auditor’s report, facts which become known to the auditor after the date of auditor’s report but before the date the financial statements are issued and facts which become known to the auditor after the financial statements have been issued.
1. SA 560 Detailed Notes
2. SA 560 Detailed Notes

SA 570 - Going Concern:
This Standard deals with the auditor’s responsibility with respect to the management’s use of the going concern assumption in the preparation and presentation of financial statements.
1. SA 570 Detailed Notes
2. SA 570 Detailed Notes

SA 580 - Written Representations:
This Standard is quite detailed in terms of the duties and objectives of the auditors regarding the acknowledgement by the management that it is fulfilling its responsibilities relating to preparation and presentation of financial statements and internal controls, the various forms of management representations, situations where management representations are unreliable, etc.
1. SA 580 Detailed Notes
2. SA 580 Detailed Notes

SA 600 - Using the Work of Another Auditor:
This SA discusses the procedures to be applied in situations where an independent auditor reporting on the financial statements of an entity, uses the work of an independent auditor with respect to the financial statements of one or more divisions or branches included in the financial statement of the entity.
1. SA 600 Detailed Notes
2. SA 600 Detailed Notes

SA 610 - Using the Work of Internal Auditors:
This Standard deals with the external auditor’s responsibility regarding the work of Internal Auditors and defines the terms “Internal Audit Functions” and “Internal Auditors”.
1. SA 610 Detailed Notes
2. SA 610 Detailed Notes

SA 620 - Using the Work of an Auditor’s Expert:
This Standard deals with the auditor’s responsibility regarding the use of an individual or organisation’s work in a field of expertise other than accounting or auditing, when that work is used to assist the auditor in obtaining sufficient appropriate audit evidence.
1. SA 620 Detailed Notes
2. SA 620 Detailed Notes

SA 700 - Forming an Opinion and Reporting on Financial Statements:
This Standard deals with the auditor’s responsibility to form an opinion on the financial statements and the form and content of the auditor’s report issued as a result of an audit of financial statements.
1. SA 700 Detailed Notes
2. SA 700 Detailed Notes

SA 705 - Modification to the Opinion in the Independent Auditor’s Report:
This Standard deals with the auditor’s responsibility to issue an appropriate report in circumstances when, in forming an opinion in accordance with SA 700, the auditor concludes that a modification to the auditor’s opinion on the financial statements is necessary.
SA 705 Detailed Notes
SA 705 Summary Notes

SA 706 - Emphasis of Matter Paragraphs and Other Matter Paragraphs in the Independent Auditor’s Report:
It deals with additional communication in the auditor’s report when the auditor considers it necessary to: Draw user’s attention to a matter or matters presented or disclosed in the financial statements that are of such importance that they are fundamental to users’ understanding of the financial statements; or draw user’s attention to any matter or matters other than those presented or disclosed in the financial statements that are relevant to users’ understanding of the audit, the auditor’s responsibilities or the auditor’s report.
SA 706 Detailed Notes
SA 706 Summary Notes

SA 710 - Comparative Information- Corresponding Figures and Comparative Financial Statements:
This Standard deals with the auditor’s responsibility regarding comparative information in an audit of financial statements. This SA defines the terms “Corresponding Figures”, “Comparative Information” and “Comparative Financial Statements”.
1. SA 710 Detailed Notes
2. SA 710 Detailed Notes

SA 720 - The Auditor’s Responsibility in relation to Other Information in Documents Containing Audited Financial Statements:
This Standard deals with the auditor’s responsibility regarding other information in documents containing audited financial statements and the auditor’s report thereon.
1. SA 720 Detailed Notes
2. SA 720 Detailed Notes

SA 800 - Special Considerations- Audit of Financial Statements Prepared in Accordance with Special Purpose Frameworks:
This Standard deals with the special considerations in the application of those SAs to an audit of Financial Statements prepared in accordance with a special purpose framework. It does not override the requirements of the other SAs; nor does it purport to deal with all special considerations that may be relevant in the circumstances of the engagement.
1. SA 800 Detailed Notes
2. SA 800 Summary Notes

SA 805 - Special Considerations- Audits of Single Financial Statements and Specific Elements, Accounts or Items of a Financial Statement:
This Standard deals with the special considerations in the application of those SAs to an audit of a single financial statement or of a specific element, account or item of a financial statement.
1. SA 805 Detailed Notes
2. SA 805 Summary Notes

SA 810 - Engagements to Report on Summary Financial Statements:
This SA deals with the auditor’s responsibilities when undertaking an engagement to report on summary financial statements derived from financial statements audited in accordance with SAs by the same auditor.
1. SA 810 Detailed Notes
2. SA 810 Summary Notes
 

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Author: Tista Athghara