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Together with foreign exchange implications, For internal audit (and other internal assurance
variability in such valuations might be expected to providers), question whether the plan continues to
be one of the greatest areas of focus as users look be focused on the key risks facing the business.
at the impact on financial statement balances. Should some audits be accelerated? Does more
need to be done about contingency planning or
Annual reports the robustness of key risk indicators which provide
early warning of issues on the horizon?
For annual financial reports, valuations and
estimates involving observable market transactions Question whether the external auditors are
may have more limited available relevant still focused on the right audit risks. How have
information at that date, and updated valuations the changes to the geopolitical and economic
may be required. environment been factored into the audit plan and
are the planned responses to risks still appropriate?
Annual reports could be expected to include What impact does the increased uncertainty and
additional discussion of factors relating to the market volatility have on the scope of the audit and
vote results. Is the required explanation of events audit materiality?
relevant to understanding the position of the entity
complete—particularly where exchange rates have Consider whether the audit should be deploying
a significant impact, circumstances affect the fair more specialist expertise in the light of the impact
value of financial instruments or where estimates on pensions, financial instruments and other
have changed. valuations?
Audit considerations Are your auditors keeping you appraised of how
their audit plans are changing? Do the changes
Audit plans—both internal and external—may accord with your understanding of how the
need to be revisited in the light of the uncertainty uncertainties associated with Brexit and Trump are
resulting from the UK and U.S. votes. impacting your business model, strategy and the
principal risks facing the business?
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