Ishita Agrawal asked 4 years ago

Sir as per SA 540 Auditor is required to review outcome of accounting estimate . This points include a point tht says outcome of A/c estimate will often differ from A/c estimate recognised so auditor need to perform Risk assesment procedure to identify difference. What is the SA talking abt here ?? Wht does thus topic wants to convey

1 Answers
RaviRavi Staff answered 4 years ago

Sometimes auditor may not have knowledge , experience to understand & examine accounting estimate , In such circumstances review of outcome of prior period estimate will help auditor to understand nature of estimate , identify risk and perform audit procedures .