Subsequent Events

[siddharth]

Hi,

What are the auditors responsibilities and audit procedures to be carried out in case the event such as release of toxic fumes which leads to enviornmental damage occured after audit report was already signed by auditor but not issued to public.

What are the auditors responsibilities and audit procedures to be carried out, when above event takes place after annual report has been issued to public ?

How disclosure takes place once annual report is issued to public ?

Can the annual report be reissued if any significant event has occured after issue of annual report?

For further clarification refer GTG question bank, question no. 57

Thanks and Regards

[Dazy]

Hi Siddharth,

How are studies going on? It’s good to see you at the end of question bank. Keep it up.

Let’s see your query. In regard to financial statements, auditor’s responsibility is that the statements are true and fair and are free from material misstatement.

Subsequent events, if affecting the financial position significantly, need to be disclosed only in the notes to accounts as these are non adjusting events. This can be done only upto the issue of report to public. To disclose such event is the management’s responsibility and auditor has to verify the same.

In my opinion, once the report is issued to public, then auditor is not responsible for the disclosure of any event occurring after the date of issue. Auditor is not responsible for re-issue of financial statements for any subsequent event, unless the event is affecting the going concern assumption.

If the going concern assumption is affected by the subsequent event, then management has a responsibility of intimating the shareholders through public notice.

This is my opinion. If I come across any such case law to support it, I will come back to you.

[ssab]

helo just wanted to tell you that susequent events can be adjusting or non adjusting. The auditor have is responsible to find any subsequent events upto the date of signing audit report and it do effect the type iof report given. After singing audit report it is management duty to inform auditor of any subsequent events.......... m in hurry will write rest of it latter as it is a bbig topic