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In a recent publication, PwC highlight issues arising from COVID-19 that may have a bearing on the wording of audit reports (PwC NZ, 2020, Likely
In a recent publication, PwC highlight issues arising from COVID-19 that may have a bearing on the wording of audit reports (PwC NZ, 2020, Likely impact of COVID-19 on audit reports). The following were among the issues raised: i. "Many entities were unable to hold year end stock counts at 31 March 2020. Or, if they did, the auditor under Lockdown level 4 was unable to attend. The auditing standards require the auditor to attend stocktakes unless it is impracticable for the auditor to do so." ii. "Cash flows and results are coming under increasing pressure. We have encouraged entities to focus on bank financing early including consideration of covenant breaches either actual or potential." iii. "Valuation of investment property (and other non-financial instrument valuations) was problematic at 31 March 2020. Valuers have included caveats in their valuations to highlight that there is less certainty than normal and there is likely a larger range of possible outcomes." REQUIRED: For each of the three issues above, discuss the implications for the auditor, including the impact on the wording and content of audit reports of publicly listed companies
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