118 paragraphs found
In meeting the ASA 315 requirement to obtain an understanding of the control environment, [21] the auditor may consider features of the control environment relevant to mitigating the risks of material misstatement associated with related party …
Controls over related party relationships and transactions within some entities may be deficient or non‑existent for a number of reasons, such as: The low importance attached by management to identifying and disclosing related party relationships and …
Fraudulent financial reporting often involves management override of controls that otherwise may appear to be operating effectively. [23] The risk of management override of controls is higher if management has relationships that involve control or …
Control activities in smaller entities are likely to be less formal and smaller entities may have no documented processes for dealing with related party relationships and transactions. An owner‑manager may mitigate some of the risks arising from related …
Authorisation involves the granting of permission by a party or parties with the appropriate authority (whether management, those charged with governance or the entity’s shareholders) for the entity to enter into specific transactions in accordance with …
During the audit, the auditor may inspect records or documents that may provide information about related party relationships and transactions, for example: Third‑party confirmations obtained by the auditor (in addition to bank and legal confirmations). …
An arrangement involves a formal or informal agreement between the entity and one or more other parties for such purposes as: The establishment of a business relationship through appropriate vehicles or structures. The conduct of certain types of …
Obtaining further information on significant transactions outside the entity’s normal course of business enables the auditor to evaluate whether fraud risk factors, if any, are present and, where the applicable financial reporting framework establishes …
Examples of transactions outside the entity’s normal course of business may include: Complex equity transactions, such as corporate restructurings or acquisitions. Transactions with offshore entities in jurisdictions with weak corporate laws. The leasing …
Enquiring into the nature of the significant transactions outside the entity’s normal course of business involves obtaining an understanding of the business rationale of the transactions, and the terms and conditions under which these have been entered …