Effect on the Dating Of Opinion in Auditing

Effect on the Dating Of the Opinion

Subsequent events have varied implications some of which do not affect the auditor’s dating of opinions while some have significant effects. Different types of subsequent events require further considerations and evaluations by the auditors. Some subsequent events provide further evidence relating to the prevailing facts at the balance sheet date and have got significant effect to the financial statements necessitate for alternate opinion. The dating of opinion by an auditor in such situations has to change since resultant information causes significant effects to the financial statement rendering the prior auditor’s opinion misleading to the management. Connectively, some subsequent events provide material information which was not available at the balance sheet date but surfaced shortly after that date. Whilst such events do not necessitate change in the financial statements, they may reveal facts which may affect decision making while relying on the financial statements. The dating of opinions by the auditor in such situations has to change to avoid misleading the users of the audited accounts with the previously held opinions. This is because the new information provides new insights to the financial statements (Bragg, 2012).

Specific Procedures

Specific procedures upon identification subsequent events by an auditor involve a series of events. For example where an auditor wishes to identify any particular subsequent events upon preparation of financial statements he follows various procedures. First, the auditor obtains the interim statements of finance and compares them with the final financial statements. This enables the auditor to identify significant material differences that may raise suspicion in preparation of those statements. The auditors are also required to inquire from relevant personnel involved in preparation of those financial statements and confirm whether the…’