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Standards on auditing 560 & accounting standards 4

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Parankusa

42 Points Posted on 12 November 2011

SA 560 deals with Subsequent events which covers events after date of Balance sheet upto auditor's report date. A portion of AS 4 deals with events after balance sheet date. But it covers events after Balance sheet date upto date of approval of financials by Board of Directors. Acounting standards are to be applied in preparation and PRESENTATION OF FINANCIAL STATEMENTS. 'Presentation of financial statements' means financials are made available to shareholders and third parties. Only an audited statement is made available to users since it is more reliable. Then why the events from date of approval by Board upto Date of auditors report not considered in AS 4? In other words, why then After balance sheet events in AS 4 not as it is in SA 560 (ie events after date of Balance sheet upto auditor's report date) ?

Please clarify my query..

Shrinidhi

Replies (1)

Ajinkya Damle

Risk Advisory

33 Points Posted on 13 November 2011

As per my knowledge,AS 4 requires adjustments to financial statements for events occuring after Balance Sheet date upto date of approval of accounts by the appropriate authority in that entity.

But as per SA 560,the auditors is required to just comment on the material items occuring even after the date of finalisation of financial statements by appropriate authority.

Hence the difference exists.