Analysing and Evaluating Key Audit Matters in Independent Auditor’s Report – Commonwealth Organization

ANALYSING AND EVALUATING KEY AUDIT MATTERS IN INDEPENDENT
AUDITOR’S REPORT – COMMONWEALTH ORGANIZATION
By Student’s Name
Course Code and Name
Professor’s Name
Institution Affiliation
Date

Executive Summary
This paper is an independent audit report, which evaluates the financial statements of
the Commonwealth Bank among the inclusion of other ASX-listed companies such as AMP,
ANZ, Bank of Queensland, Westpac and National Australia Bank. In this evaluation, key
audit matters will be analysed considering the Auditing Standard (ASA 701) that denotes the
relevant key audit matters in an independent auditor’s report. The financial statements to be
analysis are dated as at 30th June 2018. The fundamental key audit matters entail the analysis
of the accuracy of liabilities of the selected firm considering the Australian banknotes
referencing and accounting policies introduced by the federal government (Qiao, Vo and Zhu,
2019). The valuations are analysed in reference to the Australian banknotes given minimal
banknotes reduced from the exchange. Moreover, the consideration of the foreign funds and
the Australian Dollar Investment is among the vital auditing matters to be analysed in this
paper due to its relative implication in the Commonwealth Bank’s position of accounting
statements.

Introduction
There is a vital change in the audit reporting standard known as the ASA 701, which is
applies to the communication of key audit matters in an independent auditor’s report. This
standard applies to issues emerging when an auditor conveys key review matters and
evaluating key elements of audit, including budget reports of recorded organizations in an
audit report. All aspects considered, this report will display the basis of the standard and an
independent auditing report on an ASX-recorded organization (Commonwealth Bank) in the
financial business.
Rationale of New Auditing Standard ASA 701
The Auditing and Assurance Standards Board (AASB) presented the ASA 701
Communicating Key Audit Matters in an Independent Auditor's Report to manage important
issues and necessities of authoritative prerequisites and substance's key auditing matters. This
board speaks to a statutory gathering of the Australian organization under area 227A
(Australian Securities and Investment Commission Act 2001). In this manner, the body
makes evaluating benchmarks with respect to substances' enactments (Xu, Jiang, Fargher and
Carson, 2011). ASA 701 is another standard incorporated to impart KAM in an evaluator's
report of recorded organizations. Also, it empowers editors of different organizations to settle
on a choice on the incorporation of these key issues in their reports.
Independent Auditor’s Report Opinion
In reference to my assessment, Commonwealth Bank’s budget report and it is oversaw
substance (counting a united element) for the financial year finished 30th June 2018, goes
along necessity presented by the AASB, explicitly the ASA 701. Additionally, the
organization exhibits its budgetary position genuinely identified with its united substance as

at 30th June 2018, including its financial presentation income assessment by that year.
Commonwealth Bank’s fiscal summaries, which have been inspected in this investigation,
involves income profit, assessment of benefits and liabilities, exhaustive activity salary, net
premium pay and important notes clarifying the framing piece of budget reports, including
other bookkeeping data significant for this review report.
Basis for Opinion
The audit analysis has been led dependent on the gauges introduced by the Australia National
Audit Board, with reference from the AASB. Thinking about these benchmarks, an
inspector's commitment is fundamentally broke down in the Auditor's obligations area in this
paper. Thusly, I am free of the solidified company in reference to the relevant moral
contemplations of money related and bookkeeping proficient board's (Codes of Ethics for a
Professional Accountant). Conclusions displayed in these reports are to the degree of
guaranteeing that no contention emerges with the Auditor General Act 1997. Also, this
review report has satisfied any significant obligations agreed to the code.
Key Audit Matters
While attending to key auditing matters, it is significant for an examiner to considers, in
master judgment, the key issues which are essential in inspecting fiscal summaries inside a
particular timeframe (Ratzinger-Sakel and Theis, 2017). These issues were broke down in my
review degree of the applicable budget report, in the arrangement of sentiments dependent on
an element's presentation. This review report is pertinent for the organization and can be
utilized to gauge its budgetary wellbeing, later on, to keep away from potential issues as
apparent from the Lehman Brothers. This gathering, on fifteenth September 2008, was
petitioned for financial protection recording an approximated obligation of $600 billion and a