auditqualitymatters

A financial statements review ensures that the annual report complies with IFRS presentation and disclosure standards, Companies Act requirements and other relevant legislation. This review includes an appraisal of the director’s report and other documents contained in the financial statements.

The annual report supported by the auditor’s report is the tangible product of the work carried out by the auditor in the public domain. The financial statements often reflect the auditor’s compliance with recent developments in presentation requirements, where financial statement presentation in itself and statutory and disclosure requirements are important. In this regard, due importance should be given to financial statements, as to all other requirements identified in the relevant laws, professional standards or regulations.

Compass approach

A financial statement review includes:

• An appraisal of whether the auditor has implemented appropriate procedures for the issuance of updated annual reports, mainly in accordance with Companies Act and IFRS requirements.
• The review of one set of financial statement selected by the auditor.
• The involvement of the auditor by expressing his views on the issues raised.
• A presentation on identified issues.
• A report recommending agreed courses of action for improvements.
• Suggested manuals, checklists and appropriate audit programmes that may be introduced at the practice (at an extra charge if the implementation of these tools is onerous).

^{Renzo Farrugia is recognised by the Malta Institute of Accountants to provide audit support services.}