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Definitions
Comparative information represents the amounts and disclosures included in the consolidated annual accounts for one or more previous periods, and provides the users with information necessary to identify trends and changes affecting an entity over a period of time.
In the EU context, comparative information comprises corresponding figures, where amounts and other disclosures for the prior period are included as an integral part of the current period consolidated annual accounts, and are intended to be read only in relation to the amounts and other disclosures relating to the current period (referred to as “current period figures"). The level of detail presented in the corresponding amounts and disclosures is dictated primarily by its relevance to the current period figures.
Instructions
Audit Procedures
The auditor should determine whether the annual accounts correctly include the corresponding figures and whether such information is appropriately classified. For this purpose, the auditor should evaluate whether:
- the comparative information agrees with the amounts and other disclosures presented in the prior period or, when appropriate, have been restated to ensure continuity of information; and
- the accounting policies reflected in the comparative information are consistent with those applied in the current period or, if there have been changes in accounting policies, whether those changes have been properly accounted for and adequately presented and disclosed.
If the auditor becomes aware of a possible [link new-window title="material%20misstatement" link="%2Faware%2FGAP%2FPages%2FCA-FA%2FPlanning%2FMateriality.aspx" /]
in the comparative information while performing the current period audit, s(he) should perform such additional audit procedures as are appropriate in the circumstances to obtain sufficient appropriate audit evidence to determine whether a material misstatement exists.
Audit Reporting
The [link title="Statement%20of%20Assurance" link="%2Faware%2FGAP%2FPages%2FCA-FA%2FReporting%2FStatement-of-Assurance.aspx" /]
should not specifically identify the corresponding figures except in the following circumstances:
If the Statement of Assurance on the prior period, as previously issued, included a modified opinion and the matter which gave rise to the modification is unresolved:
- If the effects or possible effects of the matter on the current period’s figures are
[link new-window title="material" link="%2Faware%2FGAP%2FPages%2FCA-FA%2FPlanning%2FMateriality.aspx" /]
and require a [link title="modification%20to%20the%20auditor%E2%80%99s%20opinion" link="%2Faware%2FGAP%2FPages%2FCA-FA%2FReporting%2FModified-opinion.aspx" /]
regarding the current period figures, the auditor should refer to both the current period’s figures and the corresponding figures in the description of the matter giving rise to the modification in the Basis for Modification paragraph;
- If the effects or possible effects of the matter are either not relevant or material to the current period figures, the auditor should nevertheless modify the opinion in the Statement of Assurance on the current period’s annual accounts because of the effect or possible effects of the matter on the corresponding figures.
However, when the Statement of Assurance on the prior period, as previously issued, included a qualified opinion, a disclaimer of opinion, or an adverse opinion and the matter which gave rise to the modified opinion is resolved and properly dealt with in the consolidated annual accounts in accordance with the applicable financial reporting framework, the current Statement of Assurance need not refer to the previous modification.
If the auditor becomes aware of a material misstatement that affects the prior period consolidated annual accounts on which an unmodified Statement of Assurance has been previously issued, the auditor should follow the relevant instructions for subsequent events:
Resources
Example paragraphs: Basis for Qualified Opinion
with effect on current period’s figures and description of the current period’s figures and the corresponding figures
“As discussed in Note X to the annual accounts, no depreciation has been provided in the annual accounts, which practice, in our opinion, is not in accordance with applicable standards. This is the result of a decision taken by management at the start of the preceding financial year and caused us to qualify our audit opinion on the annual accounts relating to that year. Based on the straight-line method of depreciation and annual rates of 5% for the building and 20% for the equipment, the economic result for the year should be impacted by xxx in 20X1 and xxx in 20X0, the fixed assets should be reduced by accumulated depreciation of xxx in 20X1 and xxx in 20X0, and the net assets should be decreased by xxx in 20X1 and xxx in 20X0."
with effect or possible effects of the matter on the corresponding figures
“We were not able to observe the counting of the physical inventories at the beginning of the previous period starting 1.1.20X0 or satisfy ourselves concerning those inventory quantities by alternative means. Since opening inventories enter into the determination of the results of operations, we were unable to determine whether adjustments to the results of operations and opening net assets might be necessary for 20X0. Our auditor’s report on the annual accounts for the period ended 31.12. 20X0 was modified accordingly."
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[link new-window title="ISA%20710" link="https%3a%2f%2fwww.ifac.org%2fsystem%2ffiles%2fpublications%2ffiles%2fIAASB-2020-Handbook-Volume-1.pdf%23INTERNATIONAL%2520STANDARD%2520ON%2520AUDITING%2520710" /]
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