United States

Proposed amendments to AU-C Sections 800, 805 and 810


In May 2019, the Auditing Standards Board (ASB) issued Statement on Auditing Standards (SAS) 134, Auditor Reporting and Amendments, Including Amendments Addressing Disclosures in the Audit of Financial Statements, which included many changes related to auditor reporting.

Recently, the ASB issued a proposed SAS, Amendments to AU-C Sections 800, 805, and 810 to Incorporate Auditor Reporting Changes from SAS No. 134, to align the AU-C 800 series with the relevant SAS 134 provisions and to address other matters, which are summarized as follows:

  • In AU-C 800, Special Considerations — Audits of Financial Statements Prepared in Accordance With Special Purpose Frameworks:
    • The cash, tax, regulatory, contractual and other bases of accounting will be designated as examples of special purpose frameworks, rather than as part of the definition of special purpose framework.
    • Clarification was added providing that the auditor is required to (a) conclude whether substantial doubt exists about the entity’s ability to continue as a going concern for a reasonable period of time and (b) when substantial doubt exists, evaluate the adequacy of the financial statement disclosures as required by the applicable financial reporting framework.
    • For special purpose financial statements prepared in accordance with a contractual or other basis of accounting, the emphasis-of-matter paragraph in the auditor’s report is now required to state that the financial statements may not be suitable for another purpose.
  • In AU-C 805, Special Considerations — Audits of Single Financial Statements and Specific Elements, Accounts, or Items of a Financial Statement:
    • Clarification was added that, when the applicable financial reporting framework does not have a requirement for management to assess going concern for a single financial statement or element (or going concern is not be relevant at all to the framework), the required statements in the auditor’s report regarding management’s and the auditor’s responsibility for going concern should be adapted (or omitted if not relevant).
    • The proposed SAS adds factors that may be relevant in considering whether a matter included in the auditor’s report on a complete set of financial statements is relevant in an engagement to report on a single financial statement or a specific element, account or item of a financial statement.
  • In AU-C 810, Engagements to Report on Summary Financial Statements, the description of procedures performed by the auditor was deleted from the paragraph in the auditor’s report describing the basis for the auditor’s opinion.

If finalized, the proposed SAS will be effective for audits of financial statements of periods ending on or after December 15, 2020. The proposed SAS is available for comment until October 28, 2019.