PURPOSES OF THE AUDITOR’S REPORT

The requirements of Companies Act regarding auditors report

The Companies Act cap 486 requires that the auditor of a limited liability company to report to the

members whether the financial statements laid before the AGM show true and fair view of the state of

affairs of the company and comply with the requirements of the companies act. The audit report is

therefore the means by which the auditor reports his opinions as to whether the financial statements show

a true and fair view of the state of affairs. The report is addressed to shareholders.

Section 162(1) of the Companies Act stipulates the statements that should be expressly stated in the

auditor’s report. These are;

- Whether the auditor has obtained all the information and explanation which to the bestof his

knowledge and belief were necessary for audit proposes.

- Whether in his opinion, proper books of accounts have been kept by the company, sofar as it appears

from the examination of those books and proper returns adequate forthe purposes of the audit from

branches not visited by him.

- Whether the company’s balance sheet and profit and loss accounts dealt by the reportare in agreement

with the books of the accounts and returns.

- Whether in his opinion and to the best of his information and according to the explanationsgiven to

him, the financial statements give the information required by the CompaniesAct in the manner so

required and give at rue and fair view.

- In the case of the balance sheet, of the state of affairs of the company as at the end ofthe accounting

period.

- In the case of the profit and loss account, of the state of profit or loss of the companyin the financial

year.

- In the case of a holding company submitting group financial statements whether in hisopinion, the

group financial statements have been prepared in accordance with theprovisions of the Companies

Act so as to give a true and fair view of the state of affairsand profit or loss of the company.

Once the auditor has gathered sufficient appropriate audit evidence on which to base his opinion, he is

expected to put his findings on the true and fairness of the financial statements in a report.

a) Examining, on a test basis, evidence to support the financial statement amounts and disclosures;

b) Assessing the accounting principles used in the preparation of the financial statements;

c) Assessing the significant estimates made by management in the preparation of the financial

statements; and

d) Evaluating the overall financial statement presentation.

This report is referred to as the auditor’s report. The report is primarily meant for the Shareholders but

can be of benefit to other users of the financial statements as well for example the banks. The wording

and the format of the report is guided by law.

International Standard on Auditing (ISA) 700, Forming an Opinion and Reportingon Financial

Statements

For purposes of the ISAs, the following terms have the meanings attributedbelow:

a) General purpose financial statements – Financial statements prepared in accordance with a general

purpose framework.

b) General purpose framework – A financial reporting framework designed to meet the common

financial information needs of a wide range of users. The financial reporting framework may be a fair

presentation framework or a compliance framework.

The term “fair presentation framework” is used to refer to a financialreporting framework that requires

compliance with the requirementsof the framework and:

i) Acknowledges explicitly or implicitly that, to achieve fair presentation of the financial statements, it

may be necessary for management to provide disclosures beyond those specifically required by the

framework; or

ii) Acknowledges explicitly that it may be necessary for management to depart from a requirement of the

framework to achieve fair presentation of the financial statements. Such departures are expected to be

necessary only in extremely rare circumstances.

iii) The term “compliance framework” is used to refer to a financial reporting framework that requires

compliance with the requirements of the framework, but does not contain the acknowledgements in

(i) or (ii) above.

c) Unmodified opinion – The opinion expressed by the auditor when the auditor concludes that the

financial statements are prepared, in all material respects, in accordance with the applicable financial

reporting framework.

Reference to “financial statements” in this ISA means “a complete set of generalpurpose financial

statements, including the related notes.” The related notesordinarily comprise a summary of significant

accounting policies and otherexplanatory information. The requirements of the applicable financial

reportingframework determine the form and content of the financial statements, and whatconstitutes a

complete set of financial statements.

The objectives of the auditor are:

(a) To form an opinion on the financial statements based on an evaluation of the conclusions drawn

from the audit evidence obtained; and

(b) To express clearly that opinion through a written report that also describes the basis for that

opinion.

Management’s Responsibility for the Financial Statements

- This section of the auditor’s report describes the responsibilities of those in the organization that are

responsible for the preparation of the financial statements.

- The auditor’s report need not refer specifically to “management,” but shall use the term that is

appropriate in the context of the legal framework in the particular jurisdiction. In some jurisdictions,

the appropriate reference may be to those charged with governance.

- The auditor’s report shall include a section with the heading “Management’s [or other appropriate

term] Responsibility for the Financial Statements.”

- The auditor’s report shall describe management’s responsibility for the preparation of the financial

statements. The description shall include an explanation that management is responsible for the

preparation of the financial statements in accordance with the applicable financial reporting

framework, and for such internal control as it determines is necessary to enable the preparation of

financial statements that are free from material misstatement, whether due to fraud or error.

- Where the financial statements are prepared in accordance with a fair presentation framework, the

explanation of management’s responsibility for the financial statements in the auditor’s report shall

refer to “the preparation and fair presentation of these financial statements” or “the preparation of

financial statements that give a true and fair view,” as appropriate in the circumstances.

Supplementary Information Presented with the Financial Statements

- If supplementary information that is not required by the applicable financial reporting framework is

presented with the audited financial statements, the auditor shall evaluate whether such

supplementary information is clearly differentiated from the audited financial statements.

- If such supplementary information is not clearly differentiated from the audited financial statements,

the auditor shall ask management to change how the unaudited supplementary information is

presented.

- If management refuses to do so, the auditor shall explain in the auditor’s report that such

supplementary information has not been audited.

- Supplementary information that is not required by the applicable financial reporting framework but is

nevertheless an integral part of the financial statements because it cannot be clearly differentiated

from the audited financial statements due to its nature and how it is presented shall be covered by the

auditor’s opinion.

ELEMENTS OF THE AUDITOR’S REPORT

Basic elements of auditor’s report

The Companies Act does not stipulate the form the auditor’s report should take. The auditing standards

seek to ensure that the auditor’s report is clear and unambiguous. To this end, it seeks to standardize the

form of the auditor’s report.

It does this by giving the basic elements of the auditor’s report.

i) Appropriate report title

Auditing standards require that the report be titled and that the title includes the word ‘independent’

e.g. independent auditors report’. The requirement that the title includes the word independent is

intended to convey to users that the audit was unbiased in all aspects.The title should indicate that the

report is by an independent auditor to confirm all the relevant ethical standards have been met

ii) Address

The auditor’s report shall be addressed as required by the circumstances of the engagement. The

report is usually addressed to the company, its stockholders or the board of directors. For practical

reasons, it limits the users of auditor’s report.

iii) Introductory paragraph

The first paragraph has three purposes, fist, it makes a statement that the practice did an audit.

Secondly, it lists all the financial statements that were audited including the balance sheet dates and

accounting periods for the income statement and cash flow statement. The wording of the financial

statements in the report should be identical to those used by management on the financial statements.

Thirdly, the introductory paragraph states that the statements are the responsibility of management

and that the auditor’s responsibility is to express an opinion on the statements based on the audit.

The introductory paragraph in the auditor’s report shall:

- Identify the entity whose financial statements have been audited;

- State that the financial statements have been audited;

- Identify the title of each statement that comprises the financial statements;

- Refer to the summary of significant accounting policies and other explanatory information; and

- Specify the date or period covered by each financial statement comprising the financial

statements.

iv) Scope paragraph

This paragraph is a factual statement about what the auditor did in the audit. This paragraph states

how the audit was planned and performed in accordance with ISAs and states that the audit is

designed to obtain reasonable assurance whether the financial statements are free of material

misstatements.

v) Opinion paragraph

This final paragraph states the auditors conclusions based on the results of the audit. This part of the

report is so important that often the audit report is simply called the auditor’s opinion.

The opinion paragraph is stated as an opinion rather than a statement of absolute fact or a guarantee.

vi) Audit report date

The appropriate date for the report is the one on which the auditor has completed the most important

audit procedures in the field. This date is important to users of financial statements as it indicates the

last day of auditor’s responsibility for review of significant events that have occurred after date of

financial statements.

vii) Name of audit firm

The firm’s name is used because the entire firm has the legal responsibility to ensure that the quality

of audit meets professional standards.

viii) Management’s Responsibility for the Financial Statements

- This section of the auditor’s report describes the responsibilities of those in the organization that are

responsible for the preparation of the financial statements.

- The auditor’s report need not refer specifically to “management,” but shall use the term that is

appropriate in the context of the legal framework in the particular jurisdiction. In some

jurisdictions, the appropriate reference may be to those charged with governance.

- The auditor’s report shall include a section with the heading “Management’s [or other appropriate

term] Responsibility for the Financial Statements.”

- The auditor’s report shall describe management’s responsibility for the preparation of the financial

statements. The description shall include an explanation that management is responsible for the

preparation of the financial statements in accordance with the applicable financial reporting

framework, and for such internal control as it determines is necessary to enable the preparation of

financial statements that are free from material misstatement, whether due to fraud or error.

- Where the financial statements are prepared in accordance with a fair presentation framework, the

explanation of management’s responsibility for the financial statements in the auditor’s report shall

refer to “the preparation and fair presentation of these financial statements” or “the preparation of

financial statements that give a true and fair view,” as appropriate in the circumstances.

ix) Auditor’s Responsibility

- The auditor’s report shall include a section with the heading “Auditor’s Responsibility.”

- The auditor’s report shall state that the responsibility of the auditor is to express an opinion on the

financial statements based on the audit.

- The auditor’s report shall state that the audit was conducted in accordance with International

Standards on Auditing. The auditor’s report shall also explain that those standards require that the

auditor comply with ethical requirements and that the auditor plan and perform the audit to obtain

reasonable assurance about whether the financial statements are free from material misstatement.

- The auditor’s report shall describe an audit by stating that:

a) An audit involves performing procedures to obtain audit evidence about the amounts and

disclosures in the financial statements;

b) The procedures selected depend on the auditor’s judgment, including the assessment of the risks

of material misstatement of the financial statements, whether due to fraud or error. In making

those risk assessments, the auditor considers internal control relevant to the entity’s preparation of

the financial statements in order to design audit procedures that are appropriate in the

circumstances, but not for the purpose of expressing an opinion on the effectiveness of the

entity’s internal control.

- In circumstances when the auditor also has a responsibility to express an opinion on the effectiveness

of internal control in conjunction with the audit of the financial statements, the auditor shall omit the

phrase that the auditor’s consideration of internal control is not for the purpose of expressing an

opinion on the effectiveness of internal control; and

- An audit also includes evaluating the appropriateness of the accounting policies used and the

reasonableness of accounting estimates made by management, as well as the overall presentation of

the financial statements.

- Where the financial statements are prepared in accordance with a fair presentation framework, the

description of the audit in the auditor’s report shall refer to “the entity’s preparation and fair

presentation of the financial statements” or “the entity’s preparation of financial statements that give a

true and fair view,” as appropriate in the circumstances.

- The auditor’s report shall state whether the auditor believes that the audit evidence the auditor has

obtained is sufficient and appropriate to provide a basis for the auditor’s opinion.

x) Auditor’s Opinion

Wording of the auditor’s opinion prescribed by law or regulation

- ISA 210 explains that, in some cases, law or regulation of the relevant jurisdiction prescribes the

wording of the auditor’s report (which in particular includes the auditor’s opinion) in terms that are

significantly different from the requirements of ISAs. In these circumstances, ISA 210 requires the

auditor to evaluate:

(a) Whether users might misunderstand the assurance obtained from the audit of the financial

statements and, if so,

(b) Whether additional explanation in the auditor’s report can mitigate possible misunderstanding.

If the auditor concludes that additional explanation in the auditor’s report cannot mitigate possible

misunderstanding, ISA 210 requires the auditor not to accept the audit engagement, unless required by

law or regulation to do so. In accordance with ISA 210, an audit conducted in accordance with such law

or regulation does not comply with ISAs. Accordingly, the auditor does not include any reference in the

auditor’s report to the audit having been conducted in accordance with International Standards on

Auditing.

“Present fairly, in all material respects” or “give a true and fair view”

- Whether the phrase “present fairly, in all material respects,” or the phrase “give a true and fair view”

is used in any particular jurisdiction is determined by the law or regulation governing the audit of

financial statements in that jurisdiction, or by generally accepted practice in that jurisdiction. Where

law or regulation requires the use of different wording, this does not affect the requirement for the

auditor to evaluate the fair presentation of financial statements prepared in accordance with a fair

presentation framework.

Description of information that the financial statements present

In the case of financial statements prepared in accordance with a fair presentation framework, the

auditor’s opinion states that the financial statements present fairly, in all material respects, or give a true

and fair view of the information that the financial statements are designed to present, for example, in the

case of many general purpose frameworks, the financial position of the entity as at the end of the period

and the entity’s financial performance and cash flows for the period then ended.

Description of the applicable financial reporting framework and how it may affect the auditor’s

opinion

- The identification of the applicable financial reporting framework in the auditor’s opinion is intended

to advise users of the auditor’s report of the context in which the auditor’s opinion is expressed. The

applicable financial reporting framework is identified in such terms as:

“… in accordance with International Financial Reporting Standards” or

“… in accordance with accounting principles generally accepted in Jurisdiction X …”

- When the applicable financial reporting framework encompasses financial reporting standards and

legal or regulatory requirements, the framework is identified in such terms as “… in accordance with

International Financial Reporting Standards and the requirements of Jurisdiction X Corporations

Act.” ISA 210 deals with circumstances where there are conflicts between the financial reporting

standards and the legislative or regulatory requirements.

- The financial statements may be prepared in accordance with two financial reporting frameworks,

which are therefore both applicable financial reporting frameworks. Accordingly, each framework is

considered separately when forming the auditor’s opinion on the financial statements, and the

auditor’s opinion refers to both frameworks as follows:

a) If the financial statements comply with each of the frameworks individually, two opinions are

expressed: that is, that the financial statements are prepared in accordance with one of the

applicable financial reporting frameworks (for example, the national framework) and an opinion

that the financial statements are prepared in accordance with the other applicable financial

reporting framework (for example, International Financial Reporting Standards). These opinions

may be expressed separately or in a single sentence (for example, the financial statements are

presented fairly, in all material respects, in accordance with accounting principles generally

accepted in Jurisdiction X and with International Financial Reporting Standards).

b) If the financial statements comply with one of the frameworks but fail to comply with the other

framework, an unmodified opinion can be given that the financial statements are prepared in

accordance with the one framework (for example, the national framework) but a modified opinion

given with regard to the other framework (for example, International Financial Reporting

Standards) in accordance with ISA 705.

- The financial statements may represent compliance with the applicable financial reporting framework

and, in addition, disclose the extent of compliance with another financial reporting framework.

- Such supplementary information is covered by the auditor’s opinion as it cannot be clearly

differentiated from the financial statements.

a) If the disclosure as to the compliance with the other framework is misleading, a modified opinion

is expressed in accordance with ISA 705.

b) If the disclosure is not misleading, but the auditor judges it to be of such importance that it is

fundamental to the users’ understanding of the financial statements, an Emphasis of Matter

paragraph is added in accordance with ISA 706, drawing attention to the disclosure.

Other Reporting Responsibilities

- In some jurisdictions, the auditor may have additional responsibilities to report on other matters that

are supplementary to the auditor’s responsibility under the ISAs to report on the financial statements.

For example, the auditor may be asked to report certain matters if they come to the auditor’s attention

during the course of the audit of the financial statements. Alternatively, the auditor may be asked to

perform and report on additional specified procedures, or to express an opinion on specific matters,

such as the adequacy of accounting books and records. Auditing standards in the specific jurisdiction

often provide guidance on the auditor’s responsibilities with respect to specific additional reporting

responsibilities in that jurisdiction.

- In some cases, the relevant law or regulation may require or permit the auditor to report on these other

responsibilities within the auditor’s report on the financial statements. In other cases, the auditor may

be required or permitted to report on them in a separate report.

- These other reporting responsibilities are addressed in a separate section of the auditor’s report in

order to clearly distinguish them from the auditor’s responsibility under the ISAs to report on the

financial statements.

Auditor’s Report Prescribed by Law or Regulation

- If the auditor is required by law or regulation of a specific jurisdiction to use a specific layout or

wording of the auditor’s report, the auditor’s report shall refer to International Standards on Auditing

only if the auditor’s report includes, at a minimum, each of the following elements

a) A title;

b) An addressee, as required by the circumstances of the engagement;

c) An introductory paragraph that identifies the financial statements audited;

d) A description of the responsibility of management (or other appropriate term, ) for the preparation of

the financial statements;

e) A description of the auditor’s responsibility to express an opinion on the financial statements and the

scope of the audit, that includes:

- A reference to International Standards on Auditing and the law or regulation; and

- A description of an audit in accordance with those standards;

f) An opinion paragraph containing an expression of opinion on the financial statements and a reference

to the applicable financial reporting framework used to prepare the financial statements (including

identifying the jurisdiction of origin of the financial reporting framework that is not International

Financial Reporting Standards or International Public Sector Accounting Standards

g) The auditor’s signature;

h) The date of the auditor’s report; and

i) The auditor’s address.

Auditor’s Report for Audits Conducted in Accordance with Both Auditing Standards of a Specific

Jurisdiction and International Standards on Auditing

- An auditor may be required to conduct an audit in accordance with the auditing standards of a specific

jurisdiction (the “national auditing standards”), but may additionally have complied with the ISAs in

the conduct of the audit. If this is the case, the auditor’s report may refer to International Standards on

Auditing in addition to the national auditing standards, but the auditor shall do so only if:

a) There is no conflict between the requirements in the national auditing standards and those in ISAs

that would lead the auditor (i) to form a different opinion, or (ii) not to include an Emphasis of

Matter paragraph that, in the particular circumstances, is required by ISAs; and

b) The auditor’s report includes, at a minimum, each of the elements set out in above when the

auditor uses the layout or wording specified by the national auditing standards. Reference to law

or regulation shall be read as reference to the national auditing standards. The auditor’s report

shall thereby identify such national auditing standards.

- When the auditor’s report refers to both the national auditing standards and International Standards on

Auditing, the auditor’s report shall identify the jurisdiction of origin of the national auditing

standards.

TYPES OF AUDIT OPINION

AUDIT OPINION

The auditor’s opinion is normally based on whether the financial statements give a true and fair view (or

are presented fairly, in all material respects) in accordance with the applicable financial reporting

framework and comply with statutory requirements.

The financial reporting framework is determined by IFRS’s, with due regard to local legislation. To advise

the reader of the context in which the auditor’s opinion is expressed, the auditor’s opinion indicates the

framework upon which the financial statements are based. This designation helps the user to better

understand which financial reporting framework was used in preparing the financial statements.

The following are the various types of audit opinions that the auditor can issue:

i) Unqualified opinion.

ii) Modified opinions:

- Emphasis of matter.

- Qualified opinion.

- Disclaimer of opinion.

- Adverse opinion.

These are covered in detail below.

a) Unqualified Opinion

An unqualified opinion should be expressed when the auditor concludes that the financial statements give

a true and fair view in accordance with IFRS and the Kenyan Companies Act. An unqualified opinion also

indicates implicitly that any changes in accounting principles or in the method of their application, and the

effects thereof, have been properly determined and disclosed in the financial statements.

b) Modified Reports

Matters That Do Not Affect the Auditor’s Opinion

In certain circumstances, an auditor’s report may be modified by adding an emphasis of matter paragraph

to highlight a matter affecting the financial statements, which is included in a note to the financial statements

that more extensively discusses the matter. The emphasis of matter paragraph does not affect the auditor’s

opinion and is normally included after the auditor’s opinion paragraph. The emphasis of matter paragraph

would ordinarily refer to the fact that the auditor’s opinion is not qualified in this respect.

The engagement partner would normally consider including an emphasis of matter paragraph in the

auditor’s report in the following circumstances:

i) When there is a going concern problem; or

ii) When there is a significant uncertainty (other than a going concern problem), the resolution of which

is dependent upon future events and which may affect the financial statements; or

iii) When there is a material inconsistency in other information in documents containing financial

statements (e.g. a directors’ report), and the directors refuse to make an appropriate amendment.

Matters That Affect the Auditor’s Opinion

In certain circumstances, the auditor may not be able to express an unqualified opinion. A qualified opinion

is issued when:

i) There is a limitation on the scope of the auditor’s work (leads to a qualified opinion or disclaimer of

opinion).

ii) There is a disagreement with management regarding the acceptability of the accounting policies

selected, the method of their application or the adequacy of financial statement disclosures (leads to a

qualified opinion or adverse opinion).

As per ISA 701:

- A qualified opinionis expressed when the engagement partner concludes that an unqualified opinion

cannot be expressed but that the effect of any disagreement with management, or limitation on scope

is not so material and pervasive as to require an adverse opinion or a disclaimer of opinion. A qualified

opinion should be expressed as being ‘except for’ the effects of the matter to which the qualification

relates.

- A disclaimer of opinionis expressed when the possible effect of a limitation on scope is so material

and pervasive that the engagement team has not been able to obtain sufficient appropriate audit evidence

and accordingly is unable to express an opinion on the financial statements.

- An adverse opinionis expressed when the effect of a disagreement is so material and pervasive to the

financial statements that the engagement partner concludes that a qualification of the report is not

adequate to disclose the misleading or incomplete nature of the financial statements.

Whenever the auditor expresses an opinion that is other than unqualified, a clear description of all the

substantive reasons should be included in the report and, unless impracticable, a quantification of the

possible effect(s) on the financial statements. This information is normally set out in a separate paragraph

preceding the opinion or disclaimer of opinion and may include a reference to a note to the financial

statements that more extensively discusses the matter.

Audit Reporting When Disclosure of Material Uncertainty Is Inadequate

The following is an illustration of the relevant paragraphs when a qualified opinion is to be expressed:

i) Basis for Qualified Opinion

The Company’s financing arrangements expire and amounts outstanding are payable on March 19, 20X1.

The Company has been unable to re-negotiate or obtain replacement financing. This situation indicates

the existence of a material uncertainty that may cast significant doubt on the Company’s ability to

continue as a going concern and therefore the Company may be unable to realize its assets and discharge

its liabilities in the normal course of business. The financial statements (and notes thereto) do not fully

disclose this fact.

ii) Qualified Opinion

In our opinion, except for the incomplete disclosure of the information referred to in the Basis for

Qualified Opinion paragraph, the financial statements present fairly, in all material respects (or “give a

true and fair view of”), the financial position of the Company as at December 31, 20X0, and of its

financial performance and its cash flows for the year then ended in accordance with …

The following is an illustration of the relevant paragraphs when an adverse opinion is to be expressed:

iii) Basis for Adverse Opinion

The Company’s financing arrangements expired and the amount outstanding was payable on December

31, 20X0. The Company has been unable to re-negotiate or obtain replacement financing and is

considering filing for bankruptcy. These events indicate a material uncertainty that may cast significant

doubt on the Company’s ability to continue as a going concern and therefore the Company may be unable

to realize its assets and discharge its liabilities in the normal course of business. The financial statements

(and notes thereto) do not disclose this fact.

iv) Adverse Opinion

In our opinion, because of the omission of the information mentioned in the Basis for Adverse Opinion

paragraph, the financial statements do not present fairly (or “give a true and fair view of”) the financial

position of the Company as at December 31, 20X0, and of its financial performance and its cash flows for

the year then ended in accordance with …

Limitation on Scope

A limitation in the scope of the auditor’s work can arise in the following circumstances:

i) When the limitation in scope is imposed by the entity (for example, as a result of the terms of

engagement).

ii) When the limitation on scope is imposed by circumstances (for example, the timing of the auditor’s

appointment is such that the auditor is unable to observe the counting of inventories or when the entity’s

accounting records are inadequate and the auditor is unable to carry out reasonable alternative

procedures to obtain sufficient appropriate audit evidence to support an unqualified opinion).

When there is a limitation on the scope of the auditor’s work that requires expression of a qualified opinion

or a disclaimer of opinion, the auditor’s report should describe the limitation and indicate the possible

adjustments to the financial statements that might have been determined to be necessary had the limitation

not existed.

Disagreement with Management

Where the disagreement with management is material to the financial statements, the auditor should express

a qualified or an adverse opinion. Examples of disagreements with management are:

i) Disagreement on accounting policies due to inappropriate accounting method (qualified opinion).

ii) Disagreement on accounting policies due to inadequate disclosure (qualified or adverse opinion).

Issuing Financial Statements

The date of issue of the financial statements is the date that the auditor’s report and audited financial

statements are made available to third parties, which may be, in many circumstances, the date that they are

filed with a regulatory authority.

The audited financial statements are ordinarily sent for the directors’ approval after the engagement partner

is satisfied that sufficient and appropriate audit evidence has been obtained to arrive at the conclusion on

whether the financial statements give a true and fair view in accordance with IFRS and the Kenyan

Companies Act.

Signing the Financial Statements

The engagement partner will sign and date the auditor’s report on or after the date on which the financial

statements are signed or approved by the directors. The engagement partner will consider the effect on the

financial statements of all events and transactions that materially affect the financial statements from the

date of conclusion of fieldwork to the date of signing the auditor’s report. The engagement partner will also

ensure that written representation from management on all matters material to the financial statements,

when other sufficient appropriate audit evidence cannot reasonably be expected to exist, has been received

and is dated the same date as the auditor’s report.