Applicability of SA 700, SA 705, SA 706: ICAI Clarification

ICAI Clarification on Applicability of Auditing Standards SA 700, SA 705, SA 706

ICAI has announced (dt. 17-04-2012) the revised effective date / applicability of Standards on Auditing, namely SA 700, SA 705 and SA 706, in the case of financial statements for periods beginning on or after 1st April, 2012.

The auditing standards, i.e. SA 700, SA 705 & SA 706, were issued in the year 2010 to be made effective / applicable for audits of financial statements for the periods beginning on or after 1.4.2011, as under:

1. SA 700 (Revised), “Forming an Opinion and Reporting on Financial Statements”

2. SA 705, “Modifications to the Opinion in the Independent Auditor’s Report”

3. SA 706, “Emphasis of Matter Paragraphs and Other Matter Paragraphs in the Independent Auditor’s Report”

Besides ICAI had to ensure adequate education, publicity and familiarization with the said auditing standards before making mandatory.

Concerted efforts were made by the ICAI by way of regular CPE and other programmes to familiarise the practicing members with the requirements of these Standards on Auditing, however keeping in view the developments; the ICAI has decided to postpone applicability of these Auditing Standards, i.e. SA 700, SA 705 & SA 706, by one year and consequently the said Standards shall now be effective/applicable for audits of financial statements for periods beginning on or after 1st April, 2012 (instead of audits of financial statements for periods beginning on or after 1st April, 2011 as was earlier decided and referred to above).

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