Generally, there is no provision regarding revision of a tax audit report. But if an assessee changes the financial statement, a new tax audit report is done stating the reasons for the said changes along with the earlier audit report.
When is an audit report revised?
A revision of the tax audit report becomes necessary in many cases having reasons like apparent mistakes, incorrect information regarding facts, discovery of facts existing at the date of the audit report which are detected subsequently, etc. The nature of reasons varies from one company to another depending upon facts and situations. It involves many conditions which might exist. Revision is required depending upon the facts and circumstances of the particular case involved.
The cases where revision of the audit report is done are very rare in actual practice. One should take due care and caution for the significance of the matter. Such a move by the auditor not only indicates the independence of the auditor to act freely but also gains confidence of the people involved in the profession.
In case of companies, the auditor may revise the report till the accounts appear before an annual general meeting. But where the companies are not required to adopt accounts by anybody, the auditor may revise the audit report within a reasonable time depending upon the facts and circumstances but not after issuance of the audit report for the accounts of the next accounting period.
Where the auditor is a continuing one, he may feel that it is not necessary to revise the financial statements and issue a revised report due to the fact that necessary disclosures are made in the financial statements to be released regarding the next accounting period when the said situation arises.
Lawful acts which can be done by an auditor:
The auditor can take the following steps lawfully if required:
- Sent notice to his client that the audit report should not be associated with the financial statements;
- Sent notice to Regulatory Agencies within whose jurisdiction the client remains that the report should not be relied upon;
- Make an appropriate statement at the annual general meeting for declaring the same.
What does revision of audit report involve?
The revision of the audit denotes issuing a fresh audit report after revising the earlier one. It has to be done according to the prescribed procedure.
The auditor in any case is not allowed to withdraw the audit report he has already issued for any reason. But the auditor can take appropriate steps to check reliance on the audit report which ahs been issued by him.
Significance of revision of audit report:
The revision of an audit report is of great significance as the confidence of the people involved in the profession depends on the view expressed by the auditor in his said report.