Includes: Scope of this Auditing Standard, Effective Date

Scope of this Auditing Standard


The Australian Auditing Standards apply to group audits.  This Auditing Standard deals with special considerations that apply to group audits, in particular those that involve component auditors.


This Auditing Standard also applies, as appropriate, when the auditor involves other auditors in the audit of financial reports that are not group financial reports.  For example, an auditor may involve another auditor to observe the inventory count or inspect physical fixed assets at a remote location.


A component auditor may be required by statute, regulation or for another reason, to express an audit opinion on the financial report of a component.  The group engagement team may decide to use the audit evidence on which the audit opinion on the financial report of the component is based to provide audit evidence for the group audit, but the requirements of this Auditing Standard nevertheless apply.  (Ref: Para. A1)


In accordance with ASA 220,[1] the group engagement partner is required to determine that those performing the group audit engagement, including component auditors, collectively have the appropriate competence and capabilities , including sufficient time.  The group engagement partner is also responsible for the direction and supervision of members of the group engagement team and review of their work. [2]


The group engagement partner applies the requirements of ASA 220 regardless of whether the group engagement team or a component auditor performs the work on the financial information of a component.  This Auditing Standard assists the group engagement partner to meet the requirements of ASA 220 where component auditors perform work on the financial information of components.


Audit risk is a function of the risk of material misstatement of the financial report and the risk that the auditor will not detect such misstatements.[3]  In a group audit, this includes the risk that the component auditor may not detect a misstatement in the financial information of the component that could cause a material misstatement of the group financial report, and the risk that the group engagement team may not detect this misstatement.  This Auditing Standard 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 report.

Effective Date


[Deleted by the AUASB.  Refer Aus 0.3]


See ASA 220 Quality Management for an Audit of a Financial Report and Other Historical Financial Information, paragraphs 25-26.


See ASA 200 Overall Objectives of the Independent Auditor, and the Conduct of an Audit in Accordance with Australian Auditing Standards, paragraph A32.


See ASA 220, paragraphs 29-31.