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Section 5925, An Audit of Internal Control over Financial Reporting that is Integrated with an Audit of Financial Statements

Ef­fec­tive date:

Effective for audits of internal control over financial reporting that are integrated with audits of financial statements for periods beginning on or after January 1, 2008 except for subsequent amendments

Overview

This Section establishes standards and provides guidance regarding the auditor's professional responsibilities when engaged to perform an audit of the effectiveness of internal control over financial reporting ("the audit of internal control over financial reporting") that is integrated with an audit of the financial statements.

Management's responsibility, in an audit of internal control over financial reporting, is to provide a written assessment about the effectiveness of internal control over financial reporting based on control criteria as at a specified date. In conducting the audit of internal control over financial reporting, the auditor does not have the same familiarity with the entity's controls as management and does not interact with or observe these controls with the same frequency as management. Therefore, the auditor needs to perform audit procedures, as described in this Section, to understand and respond to financial reporting risks and to opine on internal control over financial reporting.

Effective internal control over financial reporting provides reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the applicable financial reporting framework. If one or more material weaknesses exist, the entity's internal control over financial reporting cannot be considered effective. A material weakness in internal control over financial reporting may exist even when financial statements are not materially misstated.

His­tory of Section 5925

Date

De­vel­op­ment

Com­ments

December 2009

The requirements in paragraphs 75-78, 82, 84-85, and 90 were revised on the initial issuance of the CASs in December 2009.

These amended requirements are effective for audits of internal control over financial reporting that are integrated with audits of financial statements for periods ending on or after December 14, 2010.

August 2010

The issuance of CSAE 3416, Reporting on Controls at a Service Organization, gave rise to a conforming amendment in paragraph 82 of Section 5925.

Amended paragraph 82 is effective for periods ending on or after December 15, 2011.

Note: The above sum­mary does not in­clude de­tails of con­se­quen­tial amend­ments made as the re­sult of other pro­jects.

Amendments under consideration

None

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.