Many related party transactions are in the normal course of business.  In such circumstances, they may carry no higher risk of material misstatement of the financial report than similar transactions with unrelated parties.  However, the nature of related …

Because related parties are not independent of each other, many financial reporting frameworks establish specific accounting and disclosure requirements for related party relationships, transactions and balances to enable users of the financial report to …

Even if the applicable financial reporting framework establishes minimal or no related party requirements, the auditor nevertheless needs to obtain an understanding of the entity’s related party relationships and transactions sufficient to be able to …

In addition, an understanding of the entity’s related party relationships and transactions is relevant to the auditor’s evaluation of whether one or more fraud risk factors are present as required by ASA 240, [4] because fraud may be more easily committed …

Owing to the inherent limitations of an audit, there is an unavoidable risk that some material misstatements of the financial report may not be detected, even though the audit is properly planned and performed in accordance with the Australian Auditing …

Planning and performing the audit with professional scepticism as required by ASA 200 [6] is therefore particularly important in this context, given the potential for undisclosed related party relationships and transactions.  The requirements in this …

[Deleted by the AUASB.  Refer Aus 0.3] …