Company or Entity Previously Audited (Ref: Para. 9)

At the time of amendments to the Act there will be companies limited by guarantee and entities reporting under the ACNC Act, or other applicable legislation or regulation, that have been in existence for some time and will have appointed an auditor. Where that auditor has conducted an audit of the company’s or entity’s previous financial report, that auditor will have obtained an understanding of the company or entity and its environment, including the company’s or entity’s internal control, in accordance with the Australian Auditing Standards. Accordingly, the auditor conducting a review, does so in accordance with ASRE 2410.^[7] ASRE 2410 is to be read in conjunction with ASA 101 Preamble to Australian Auditing Standards, as amended.

Company or Entity Not Previously Audited by the Auditor (Ref: Para. 10)

A company limited by guarantee, and entities reporting under the ACNC Act, or other applicable legislation or regulation, may engage an auditor, who has not conducted an audit of the company’s or entity’s previous financial report, to conduct a review of its financial report.  In such cases, that auditor will not have recently obtained an understanding of the company or entity and its environment, including the company’s or entity’s internal control, through compliance with Australian Auditing Standards.  Accordingly, that auditor conducts the review in accordance with ASRE 2400.^[8]  ASRE 2400 is to be read in conjunction with ASA 100 Preamble to AUASB Standards.

(Ref: Para 12)

When complying with the fundamental ethical principles in accordance with ASRE 2400, an auditor with no previous engagement experience with the company or entity, pays particular attention to the principles of professional competence and due care.