CA ANZ have developed this publication to help practitioners understand and effectively implement the new auditing standard; ASA/ISA (NZ) 701 Communicating Key Audit Matters in the Independent Auditor’s Report.
Key Audit Matters (KAM) are defined as those matters that, in the auditor’s professional judgement, were of most significance in the audit of the financial statements of the current period. For the first time in the history of auditing, a unique commentary has been introduced in the audit report to stakeholders.
This is a revolutionary change to the single most tangible output of the audit, which up until now has been binary. The paper provides helpful examples to assist with the challenges of practical application of the new standard. KAM will be required in audit reports for listed entities in Australia and listed issuers in New Zealand for periods ending on or after 15 December 2016.