Scope‖ refers to the auditors‘ ability to perform audit procedures deemed necessary in the circumstances. The reader needs this as an assurance that the audit has been carried out in accordance with established auditing practices or standards.
The auditors report should include a statement that the audit was planned and performed to obtain reasonable assurance about whether the financial statements are free of material misstatements.
It should also describe the scope of the audit by stating that the audit was conducted in accordance with ISA‘s or in accordance with relevant national standards or practices as appropriate.
The auditors report should describe an audit as including: –
(i) Examining, on a test basis, evidence to support the financial statement amounts and disclosures.
(ii) Assessing the accounting principles used in the preparation of the financial statements.
(iii) Assessing any significant estimates made by management in the preparation of the financial statements.
(iv) Evaluating the overall financial statements presentation.