AGS 12 Group Audits - Inaccessibility of Component Auditors’ Work Papers and Other Considerations

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AGS 12 Group Audits - Inaccessibility of Component Auditors’ Work Papers and Other Considerations provides guidance for group engagement teams on reliance on the work performed by the component auditor in situations where the group engagement team has determined it to be necessary to review the component auditor’s work papers but is unable to access the component auditor’s work papers due to an extraordinary event which restricts travel.

In a group audit, SSA 600 Special Considerations – Audits of Group Financial Statements (Including the Work of Component Auditors) sets out clear requirements for obtaining sufficient audit evidence and documentation of work done by component auditors so as to form a basis for the group audit opinion.

With the occurrence of an extraordinary event, such as an outbreak of a contagious virus or a natural disaster which restricts travel, group engagement teams with significant components in overseas locations may face challenges in gaining physical access to review the component auditors’ work papers. This poses a practical challenge to group engagement teams in completing their audits.

This Statement provides guidance for group engagement teams on alternative methods of performing the review of component auditors’ work papers, apart from visiting the component auditor’s office to review work papers or reviewing the work papers remotely through the use of technology.

This Statement also provides guidance on other audit considerations which are applicable to group engagement teams arising from such extraordinary events.