Auditor’s Report on Financial Statements of a Non-Corporate Entity Prepared in Accordance with a General Purpose Compliance Framework

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For purposes of this illustrative auditor’s report, the following circumstances are assumed:

  • Audit of a complete set of financial statements of a non-corporate entity, required by law or regulation. The audit is not a group audit (i.e., SA 600 does not apply).
  • The financial statements are prepared by management of the entity in accordance with the Financial Reporting Framework (XYZ Laws) of Jurisdiction X (that is, a financial reporting framework, encompassing law or regulation, designed to meet the common financial information needs of a wide range of users, but which is not a fair presentation framework).
  • The terms of the audit engagement reflect the description of management’s responsibility for the financial statements in SA 210.
  • The auditor has concluded an unmodified (i.e., “clean”) opinion is appropriate based on the audit evidence obtained.
  • The relevant ethical requirements that apply to the audit are the Code of Ethics issued by ICAI.
  • Based on the audit evidence obtained, the auditor has concluded that a material uncertainty does not exist related to events or conditions that may cast significant doubt on the entity’s ability to continue as a going concern in accordance with SA 570 (Revised).
  • The auditor is not required, and has otherwise not decided, to communicate key audit matters in accordance with SA 701.
  • Those responsible for oversight of the financial statements differ from those responsible for the preparation of the financial statements.
  • The auditor has no other reporting responsibilities required under local law.


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[Appropriate Addressee]


We have audited the financial statements of ABC & Associates (the entity), which comprise the balance sheet as at March 31, 20X1, and the Profit and Loss Account (and the cash flow statement) for the year then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements of the entity are prepared, in all material respects, in accordance with XYZ Laws.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) issued by ICAI. Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the entity in accordance with the Code of Ethics issued by ICAI and we have fulfilled our other ethical responsibilities in accordance with the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Responsibilities of Management and Those Charged with Governance for the Financial Statements

Management is responsible for the preparation of the financial statements in accordance with XYZ Laws and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the entity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the entity or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the entity’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

For XYZ & Co

Chartered Accountants

(Firm’s Registration No.)


(Name of the Member Signing the Audit Report)


(Membership No.)

Place of Signature:


This Post Has 2 Comments

  1. vswami

    Look through the above Post on Linkedin. As brought out therein, in own perspective, the given format for audit report is not intended to be adopted by a CA for reporting on the financial statements of a housing -society /-association, which is not a ‘business entity’, but to which the ‘principle of mutuality’ admittedly applies!?

    Hope the ICAI as the concerned apex regulatory authority is listening and as desired ,taking a conscious note of !


  2. vswami

    Given -“Audit Report Format of Partnership Firm, LLP, Sole Proprietor, etc.”
    Each one is a distinct form of entity governed by materially different law
    In the above faulted Audit Report, however, its Author ‘s description displayed read as indicated below:
    < For …. & ASSOCIATES
    Chartered Accountants
    CA. …..
    M.NO. …."
    So much so that is intriguingly confusing with no clarity as to whether it a Partnership FIRM or a Sole Proprietor Concern or what other?!?

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