Wiley Practitioner's Guide to GAAS 2020

34AU-C 720 Other Information in Documents Containing Audited Financial Statements

Scope

Definitions of Terms

Objective of AU-C Section 720

Requirements

AU-C 720 Illustration: Other-Matter Paragraph to Disclaim an Opinion on Other Information (from AU-C 720.A13)

SCOPE

AU-C 720 offers auditors guidance on their responsibilities related to other information in documents containing audited financial statements. If there are no separate requirements in the circumstances, the auditors have no responsibility for determining whether the other information is purposely stated. (AU-C 720.01)

Other information may include a report by management or those charged with governance on operations, financial summaries or highlights, employment data, planned capital expenditures, financial ratios, names of officers and directors, and selected quarterly data. Other information does not include a press release or similar memorandum or cover letter accompanying the document containing audited financial statements and the auditor’s report thereon, information contained in analyst briefings, or information contained on the entity’s website. (AU-C 720.A3–.A4)

DEFINITIONS OF TERMS

Source: AU-C 720.05. For definitions related to this standard, see Appendix A, “Definitions of Terms”: Inconsistency, Misstatement of fact, Other information.

OBJECTIVE OF AU-C SECTION 720

AU-C Section 720.04 states that:

… the objective of the auditor is to respond appropriately when the auditor becomes aware that documents ...