Drawing attention without modifying the opinion.
To draw users' attention to matters of fundamental importance (Emphasis of Matter) or relevant other matters (Other Matter), without modifying the opinion.
SA 706 sits in the Reporting phase of the audit. The Standards on Auditing are issued by the ICAI Auditing and Assurance Standards Board (AASB) and deemed to be prescribed by the Central Government under Section 143(10) of the Companies Act 2013. Compliance with SAs is mandatory for every audit conducted by a Chartered Accountant in India.
For authoritative text, refer to the ICAI AASB Compendium of Standards on Auditing at icai.org.
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SA 706 — Emphasis of Matter and Other Matter Paragraphs (Revised) — is a Standard on Auditing issued by the ICAI Auditing and Assurance Standards Board. Drawing attention without modifying the opinion. To draw users' attention to matters of fundamental importance (Emphasis of Matter) or relevant other matters (Other Matter), without modifying the opinion.
Yes. Standards on Auditing are deemed to be prescribed under Section 143(10) of the Companies Act 2013, and ICAI members must comply with them in every audit of historical financial information. Non-compliance must be justified and can attract professional consequences in peer review, NFRA inspection, and disciplinary proceedings.
Documentation sufficient for an experienced auditor with no previous connection to the audit to understand what was done and why (SA 230). For SA 706 in the reporting phase, that means evidencing: Emphasis of Matter only for matters appropriately presented / disclosed in the FS; Placed after the Basis for Opinion section (and, by auditor judgement, before or after Key Audit Matters) — never before Basis for Opinion; Clear statement that the opinion is not modified.
