Standards of Auditing

The standards on auditing, review, other assurance, quality control and related services are aimed towards delivery of high-quality audits by improving the quality of practice by professional accountants and ultimately increase public confidence in financial reporting.

(i) Standards on Quality Control (SQC): To be in applied in ensuring quality by firms that performs audits and Reviews of Historical Financial Information, and Other Assurance and Related Services Engagements. SQC requires that the firm should establish a system of quality control designed to provide it with reasonable assurance that the firm and its personnel comply with professional standards, regulatory, legal requirements, and that reports issued by the firm or engagement partner(s) are appropriate in the circumstances. SQC, therefore sets the tone for enhancing the quality of audit. [Number of Standards: 1]

(ii) Standards on Auditing (SAs): To be applied in the audit of historical financial information. [Number of Standards: 38]

(iii) Standards on Review Engagements (SREs): To be applied in the review of historical financial information. [Number of Standards: 2]

(iv) Standards on Assurance Engagements (SAEs): To be applied in assurance engagements, other than audits and reviews of historical financial information. [Number of Standards: 3]

(v) Standards on Related Services (SRSs): To be applied to engagements involving application of agreed- upon procedures to information, compilation engagements, and other related services engagements, as may be specified by the ICAI. [Number of Standards: 2]

Standards on Auditing

The Standards on Auditing (SAs) issued by ICAI are based on International Standards on Auditing (ISAs) issued by International Federations of Accountants (IFAC). These Standards are issued by the AASB under the authority of the council of the ICAI. Section 143 (2) of the Companies Act 2013 requires the auditor to ensure compliance with these standards on auditing

The standards on auditing have been divided into 38 standards presently grouped into 6 categories as detailed below.

• 100-199: Introductory Matters (Nil Standard)
• 200-299: General Principles & Responsibilities (9 Standards)
• 300-499: Risk Assessment and Response to Assessed Risks (6 Standards)
• 500-599: Audit Evidence (11 Standards)
• 600-699: Using Work of Others (3 Standards)
• 700-799: Audit Conclusions & Reporting (6 Standards)
• 800-899: Specialised Areas (3 Standards)

Each Standard has a uniform structure which includes the following:

• Introduction
• Objective
• Definitions
• Requirements
• Application and other explanatory material

The number given to SA is similar to the numbering system followed for International Standards on Auditing formulated by IAASB.

• Standards on Assurance Engagements (SAEs) for assurance engagements other than the audits and reviews of financial information.
• Standards on Review Engagements (SREs) for reviewing historical financial information.
• Standards on Related Services (SRSs) for all engagements about the application of agreed procedures to information, compilation engagements, and other related services engagements.