SA 580: Written Representations#
Definition#
Written representations are statements by management provided to the auditor to confirm certain matters and support other audit evidence.
Purpose#
- Confirm management's responsibilities
- Support other audit evidence
- Reduce documentation requirements
Types of Representations#
1. Specific Representations
- About specific items in financial statements
- About assertions in audit
2. General Representations
- Completeness of information
- Accuracy of financial records
- Compliance with laws
- No undisclosed liabilities
Key Representations#
- Financial statements are prepared properly
- All relevant information provided
- No material misstatements
- Compliance with applicable laws
- Completeness of related party transactions
- Subsequent events disclosed
- No fraud or suspected fraud
Requirements#
- Dated near date of auditor's report
- Signed by those with appropriate authority
- Addressed to auditor
- Include specific and general representations
Limitations#
- Not alternative to audit evidence
- Cannot replace other procedures
- Reliance limited when management is unreliable