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Identification and Disclosure of Key Audit Matters in the Audit Report Outlook of Iranian


Kermani, NJN and Mollanazari, M and Rahmani, A and Azizkhani, M, Identification and Disclosure of Key Audit Matters in the Audit Report Outlook of Iranian, Journal of Management Accounting and Auditing Knowledge, 8, (29) pp. 229-242. ISSN 2322-5785 (2019) [Refereed Article]

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© 2019 Journal of Management Accounting and Auditing Knowledge. Licensed under Creative Commons Attribution 4.0 International (CC BY 4.0)

DOI: doi:10.5281/zenodo.3241515


The purpose of the present research is to investigate the outlook of auditors on key auditing matters according to ISA 701. Responses to questionnaires distributed among members of the CPA, indicate that evaluations made by auditors of the basic assumptions that form the basis for recognition and disclosure of financial statement items in the auditor report, the approach taken by the auditor when faced with various risks in the company, accounts with the highest risks of significant fraud including risks of fraud in the auditor report, auditor evaluation of significant events and transactions during the fiscal period as well as matters that hold the highest significance in the financial statements based on the auditorís judgment have to be identified as key audit matters. From the auditorís point of view, disclosure of KAM results in enhancement of the informational value of the auditor report and reduction of its uniformity, an increase in professional and legal accountability of the auditor, enhancement of investor decision making, and promotion of audit and financial reporting quality. KAMs differ in and across various industries. Furthermore, auditors believe that disclosure of KAM results in user perception of a piecemeal opinion issued by the auditor on these matters as well as unacceptability of the unmodified audit opinion issued, diversity in Key Audit Matters due to the differing professional judgments applied by auditors, increase in audit fees, negative impact on the client-auditor relationship, increased pressure by client on the auditor and user perception of the auditor as the original source of information. Auditors have also expressed the necessity of guidelines for the identification and disclosure of KAMs and believe that these matters must be disclosed in paragraphs closest in proximity to the auditor opinion and an appropriate heading must be given to each category.

Item Details

Item Type:Refereed Article
Keywords:Key Audit Matters, ISA 710, Audit report
Research Division:Commerce, Management, Tourism and Services
Research Group:Accounting, auditing and accountability
Research Field:Accounting theory and standards
Objective Division:Expanding Knowledge
Objective Group:Expanding knowledge
Objective Field:Expanding knowledge in commerce, management, tourism and services
UTAS Author:Azizkhani, M (Dr Masoud Azizkhani)
ID Code:136496
Year Published:2019
Deposited By:TSBE
Deposited On:2019-12-31
Last Modified:2020-05-19
Downloads:17 View Download Statistics

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