TWSA600 Special Considerations—Audits of Group Financial Statements 　　　　

Status

Revised by Auditing Standards Committee in Taiwan on 4 October, 2022

Summary

This Standard deals with special considerations that apply to group audits, in particular those that involve component auditors. It explains the matters that the group engagement team considers when determining the nature, timing and extent of its involvement in the risk assessment procedures and further audit procedures performed by the component auditors on the financial information of the components. The purpose of this involvement is to obtain sufficient appropriate audit evidence on which to base the audit opinion on the group financial statements.

The group engagement partner is responsible for the direction, supervision and performance of the group audit engagement in compliance with professional standards and applicable legal and regulatory requirements, and whether the auditor’s report that is issued is appropriate in the circumstances. The group engagement team shall establish an overall group audit strategy and shall develop a group audit plan in accordance with TWSA300. The auditor is required to identify and assess the risks of material misstatement through obtaining an understanding of the entity and its environment, including group-wide controls and consolidation process. Having gained an understanding of each component auditor, the group engagement partner should decide whether to make reference to a component auditor in the auditor's report on the group financial statements. The auditor is required to determine appropriate type(s) of materiality, and is required to design and implement appropriate responses to address the assessed risks of material misstatement of the financial statements. The group engagement team or the component auditors should perform procedures designed to identify events at those components that occur between the dates of the financial information of the components and the date of the auditor's report on the group financial statements. The group engagement team should communicate its requirements to a component auditor on a timely basis, and communicate to group management and those charged with governance of the group material weaknesses and significant deficiencies in internal control that are relevant to the group. The group engagement team should evaluate whether sufficient appropriate audit evidence on which to base the group audit opinion has been obtained. Finally, this Standard requires the information that group engagement team should include in the audit documentation.

This Standard also prescribes additional requirements applicable when assuming responsibility for the work of a component auditor.

Effective date

This Standard is effective from 15 December, 2022.