This helpsheet has been issued by ICAEW’s Technical Advisory Service to help ICAEW members to ensure their audit report complies with International Standards on Auditing (UK) (ISAs (UK)) where the prior period financial statements were not audited.

Members may also wish to refer to the following related guidance:

• Audit and Assurance Faculty Guides - Audit Reports
• FRC's illustrative auditor’s reports
• TECH 01/03 AAF (Revised) The Audit Report and Auditors’ Duty of Care to Third Parties

ISA (UK) 710 paragraph 14 requires the auditor to state in an Other Matter paragraph, in the auditor’s report, that the corresponding figures are unaudited.

Auditors are reminded, however, that they still have a requirement to obtain sufficient appropriate audit evidence that the opening balances do not contain misstatements that materially affect the current period’s financial statements.

As paragraph A16 of ISA (UK) 706 states, the location of an Other Matter paragraph requires judgment to be exercised:

Therefore, the location of an Other Matter paragraph largely depends on the significance of informing users of the accounts that the prior year’s accounts were not audited. The Other Matter paragraph should be presented somewhere between the Basis for Opinion section and the Use of report section, which as discussed in TECH 01/03 AAF The Audit Report and Auditors’ Duty of Care to Third Parties, is the last section of the audit report.

ICAEW members, affiliates, ICAEW students and staff in eligible firms with member firm access can discuss their specific situation with the Technical Advisory Service on +44 (0)1908 248 250 or via webchat.