Please confirm what the auditors must do if they have not finalised resulting in the financials not being ready after the 6 months from financial year-end?
In terms of APA (Auditing Profession Act), the auditors need to consider reporting a Reportable Irregularity accordingly. This is NOT AUTOMATICALLY A REPORTABLE IRREGULARITY!
- If the company did not prepare AFS within 6 months, the RA must consider whether a RI exists (by measuring the specific circumstances against the definition and criteria of a RI). A RI will only exist if ALL the criteria are met.
- If a RI exists, the RA must report to IRBA without delay, and follow the process in terms of Section 45 of the APA.
- If a RI does not exist, the RA should document the entire consideration and conclusion properly, and consider the effect of the non-compliance on other areas of the audit, i.e. NOCLAR, effect on audit report, etc.
Disclaimer:
Please note that the information provided does not constitute legal or professional advice, but rather the applicability of existing theory to a given practical situation. Due care is taken to ensure that the information is correct, but it remains subjective and an interpretation of application of information.
