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Prior year unaudited - Audit report implications

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Published: 13 Aug 2018 Updated: 02 Feb 2022 Update History

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Technical helpsheet issued to help ICAEW members to ensure their audit report complies with International Standards on Auditing (UK) (ISAs (UK)) where the prior period financial statements were not audited.


This helpsheet has been issued by ICAEW’s Technical Advisory Service to help ICAEW members to ensure their audit report complies with International Standards on Auditing (UK) (ISAs (UK)) where the prior period financial statements were not audited.

Members may also wish to refer to the following related guidance:

Inclusion of an other matter paragraph

ISA (UK) 710 paragraph 14 requires the auditor to state in an Other Matter paragraph, in the auditor’s report, that the corresponding figures are unaudited.

Auditors are reminded, however, that they still have a requirement to obtain sufficient appropriate audit evidence that the opening balances do not contain misstatements that materially affect the current period’s financial statements.

Location of the other matter paragraph

As paragraph A16 of ISA (UK) 706 states, the location of an Other Matter paragraph requires judgment to be exercised:

The placement of an […] Other Matter paragraph in the auditor’s report depends on the nature of the information to be communicated, and the auditor’s judgment as to the relative significance of such information to intended users compared to other elements required to be reported in accordance with ISA (UK) 700. […]

Therefore, the location of an Other Matter paragraph largely depends on the significance of informing users of the accounts that the prior year’s accounts were not audited. The Other Matter paragraph should be presented somewhere between the Basis for Opinion section and the Use of report section, which as discussed in TECH 01/03 AAF The Audit Report and Auditors’ Duty of Care to Third Parties, is the last section of the audit report.

If in doubt seek advice

ICAEW members, affiliates, ICAEW students and staff in eligible firms with member firm access can discuss their specific situation with the Technical Advisory Service on +44 (0)1908 248 250 or via webchat.

Terms and conditions

© ICAEW 2024  All rights reserved.

ICAEW cannot accept responsibility for any person acting or refraining to act as a result of any material contained in this helpsheet. This helpsheet is designed to alert members to an important issue of general application. It is not intended to be a definitive statement covering all aspects but is a brief comment on a specific point.

ICAEW members have permission to use and reproduce this helpsheet on the following conditions:

  • This permission is strictly limited to ICAEW members only who are using the helpsheet for guidance only.
  • The helpsheet is to be reproduced for personal, non-commercial use only and is not for re-distribution.

For further details members are invited to telephone the Technical Advisory Service T +44 (0)1908 248250. The Technical Advisory Service comprises the technical enquiries, ethics advice, anti-money laundering and fraud helplines. For further details visit icaew.com/tas.

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Changelog Anchor
  • Update History
    01 Aug 2018 (12: 00 AM BST)
    First published
    04 Feb 2021 (12: 00 AM GMT)
    Changelog created, helpsheet converted to new template
    02 Feb 2022 (03: 40 PM GMT)
    Reviewed, links to FRC Illustrative audit reports changed, as more recent version is now on their website.