Applicability Date for Revised SA 700, SA 705, SA 706: ICAI Clarification

Applicability Date of Auditing Standards: SA 700 (Revised), SA 701, SA 705 (Revised), SA 706 (Revised)

ICAI Clarification/ Announcement dt. 1 Apr. 2017

SA 700 (Revised)- Forming an Opinion and Reporting on Financial Statements, SA 701- Communicating Key Audit Matters in the Independent Auditor’s Report, SA 705 (Revised)- Modifications to the Opinion in the Independent Auditor’s Report and SA 706 (Revised)- Emphasis of Matter Paragraphs and Other Matter Paragraphs in the Independent Auditor’s Report were approved by the ICAI at its 350th meeting held in February 2016 and all these standards were announced to be applicable for audits of financial statements for periods beginning on or after April 1, 2017.

However, the ICAI has reviewed the members’ concerns and has announced that the effective date of Standards on Auditing {SA 700 (Revised), SA 701, SA 705 (Revised) and SA 706 (Revised)} stands deferred by one year, i.e. these Auditing Standards shall be applicable for audits of financial statements of periods beginning on or after 1 Apr. 2018 (instead of 1 Apr. 2017). However, the pre-revised SA 700, SA 705 and SA 706 will continue to apply, in the meantime.

ICAI Clarification/ Announcement dt. 17 Apr. 2012

ICAI has announced 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).

ICAI’s Revised Standards on Auditing (SA 700, SA 701, SA 705, SA 706, SA 260 & SA 570)

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