 General Considerations

PSA 800 (Revised and Redrafted), “Special

Considerations- Audits of Financial Statements
Prepared in Accordance with Special Purpose
Framework” deals with special consideration in the
application of PSAs to an audit of financial statements
prepared in accordance with special purpose
framework.
 A tax basis of accounting for a set of financial
statements that a company an entity’s tax return;
The cash receipts and disbursements basis of
accounting for cash flow information that an
entity maybe requested to prepared for creditors;
The financial reporting provisions established by
a regulator to meet the requirements of that
regulator; or
The financial reporting provisions of a contract,
such as a bond indenture, a loan agreement, or
a project grant.
The following general considerations and principles should be
observed:

The auditor should determine the acceptability of the financial

reporting framework applied in the preparation of the financial
statements. In an audit of special purpose financial statements,
the auditor shall obtain an understanding of:

The purpose for which the financial statements are prepared;

The intended users; and
The steps taken by management to determine that the applicable
financial reporting framework is acceptable in the circumstances.

In planning and performing an audit of special purpose

financial statements, the auditor shall determine whether
application of the PSAs requires special consideration in the
circumstances of the engagement.
The auditor is required to obtain an understanding
of the entity’s selection and application of
accounting policies.

When forming an opinion and reporting on special

purpose financial statements, the auditor shall apply
the requirements in PSA 700 (Redrafted) “Forming
an Opinion and Reporting on Financial Statements”

PSA 700 (Redrafted) requires the auditor to

evaluate whether the financial statements
adequately prepare to or describe the applicable
financial reporting framework.
The auditor’s report on special purpose financial statements should:

The auditor’s report shall also describe the purpose for which the
financial statements are prepared and, if necessary, the intended users,
or refer to a note in the special purpose financial statements that
contains that information; and

If management has a choice of financial reporting frameworks in the

preparation of such financial statement, the explanation of
management’s responsibility for the financial statements shall also
make reference to its responsibility for determining that the applicable
financial reporting framework is acceptable in the circumstances.

The auditor’s report on special purpose financial statements shall

include Emphasis of Matter paragraph alerting users of the auditor’s
report that the financial statement are prepared in accordance with a
special purpose framework and that, as a result, the financial
statements may not be suitable for another purpose. The auditor shall
include this paragraph under an appropriate heading.
INDEPENDENT AUDITOR’S REPORT

[Appropriate Addressee]

We have audited the accompanying financial statements of ABC Partnership, which comprise the balance sheet as
at December 31, 20X1 and the income statement for the year then ended, and a summary of significant accounting
policies and other explanatory information. The financial statements have been prepared by management using the
tax basis of accounting in Jurisdiction X.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements in accordance with the tax basis of
accounting in Jurisdiction X; this includes the design, implementation and maintenance of internal control relevant to
the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
audit in accordance with Philippine Standards on Auditing. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence
about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s
judgment, including the assessment of the risks of material misstatement of the financial statements whether due to
fraud or error. In making those risk assessment, the auditor considers internal control relevant to the partnership’s
audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the partnership’s internal control. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of accounting estimates made by
management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinion.

Opinion

In our opinion, the financial statements of ABC Partnership for the year ended December 31, 20X1 are
prepared, in all material respects, in accordance with [describe the applicable income tax law] of
Jurisdiction X.

Basis of Accounting and Restriction on Distribution

Without modifying our opinion, we draw attention Note X to the financial statements, which describes the
basis of accounting. The financial statements are prepared to assist the partners of ABC Partnership in
preparing their individual income tax returns. As a result, the financial statements may not be suitable for
another purpose. Our report is intended solely for ABC Partnership and its partners and should not be
distributed to parties other than ABC Partnership or its partner.

[Auditor’s signature]

[Date of the auditor’s report]

[Auditor’s address]
INDEPENDENT AUDITOR’S REPORT

[Appropriate Addressee]

We have audited the accompanying financial statements of ABC Company, which comprise the balance sheet as at
December 31, 20X1 and the income statement, statement of changes in equity, and cash flow statement for the
year then ended, and a summary of significant accounting policies and other explanatory information. The financial
statements have been prepared by management of ABC Company based on the financial reporting provisions of
Section Z of the contract dated January 01, 20X1 between ABC Company and DEF Company (“the contract”).

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements in accordance with the financial
reporting provisions of Section Z of the contract; this includes the design, implementation and maintenance of
internal control relevant to the preparation of financial statements that are free from material misstatement, whether
due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
audit in accordance with Philippine Standards on Auditing. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
material misstatement of the financial statements whether due to fraud or error. In making those risk assessment,
the auditor considers internal control relevant to the entity’s preparation of the financial statements in order to design
audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting
policies used and the reasonableness of accounting estimates made by management, as well as evaluating the
overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinion.

Opinion

In our opinion, the financial statements of ABC Company for the year ended December 31, 20X1 are prepared, in all
material respects, in accordance with financial reporting provisions of Section Z of the contract.

Basis of Accounting and Restriction on Distribution

Without modifying our opinion, we draw attention Note X to the financial statements, which describes the basis of
accounting. The financial statements are prepared to assist the ABC Company to comply with the financial reporting
provisions of the contract referred to above. As a result, the financial statements may not be suitable for another
purpose. Our report is intended solely for ABC Company and DEF Company and should not be distributed to parties
other than ABC Company or DEF Company.

[Auditor’s signature]
[Date of the auditor’s report]
[Auditor’s address]
INDEPENDENT AUDITOR’S REPORT

[Appropriate Addressee]

We have audited the accompanying financial statements of ABC Company, which comprise the balance sheet as at
December 31, 20X1 and the income statement, statement of changes in equity, and cash flow statement for the year
then ended, and a summary of significant accounting policies and other explanatory information. The financial
statements have been prepared by management based on the financial reporting provisions of Section Y of the
Regulation Z.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements in accordance with the financial reporting
provisions of Section Y of Regulation Z; this includes the design, implementation and maintenance of internal control
relevant to the preparation of financial statements that are free from material misstatement, whether due to fraud or
error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit
in accordance with Philippine Standards on Auditing. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditor’s judgment, including the assessment
of the risks of material misstatement of the financial statements whether due to fraud or error In making
those risk assessment, the auditor considers internal control relevant to the entity’s preparation of the
financial statements in order to design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the entity’s internal control.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.

Opinion

In our opinion, the financial statements present fairly, in all material respects, the financial position of ABC
Company as at December 31, 20X1, and (of) its financial performance and its cash flows for the year then
ended in accordance with financial reporting provisions of Section Y of Regulation Z.

Basis of Accounting

Without modifying our opinion, we draw attention Note X to the financial statements, which describes the
basis of accounting. The financial statements are prepared to assist the ABC Company to meet the
requirements of Regulator DEF. As a result, the financial statements may not be suitable for another
purpose.
Other Matter

ABC Company has prepared a separate set of financial statement for the year ended December 31,
20X1 in accordance with Philippines Financial Reporting Standards on which we issued a separate
auditor’s report to the shareholders of ABC Company dated March 31, 20X2.

[Auditor’s signature]

[ Date of the auditor’s report]

[Auditor’s address]
PSA 805 (Revised and Redrafted), “ Special Consideration--- Audits of
Single Financial Statements and Specific Elements, Accounts or Items
of a Financial Statement,”

It deals with special consideration and the application of those

PSAs to an audit of a single financial statement and specific element,
account or items of a financial statement. The single financial
statement and specific element, account or items of a financial
statement maybe prepared in accordance with a general or special
purpose framework.
Accounts receivable, allowance for doubtful accounts
receivable, inventory, the liability for accrued benefits of a
private pension plan, the recorded value of identified
intangible asset, or the liability for “incurred but not
recorded” claims in an insurance portfolio, including
related notes.
A schedule of externally managed assets and income of a
private pension plan, including related notes.
A schedule of net tangible asset, including related notes.
A schedule of disbursements in relation to a lease
property, including explanatory notes.
A schedule of profit participation or employee bonuses,
including explanatory notes.
The following guidelines should be observe:

The auditor is required to comply with all PSAs relevant to the audit. In the case of an
audit of a single financial statement or of a specific element of a financial statement, this
requirement applies irrespective of whether the auditor is also engaged to audit the
entity’s complete set of financial statements.

The auditor is required to determine the acceptability of the financial reporting

framework applied in the preparation of the financial statements. In the case of an audit
of a single financial statement or of a specific element of a financial statement , this will
include whether application of the financial reporting framework will result in a
presentation that provides adequate disclosures to enable the intended users to
understand the information conveyed in the financial statement or the element, and the
effect of material transactions and events on the information conveyed in the financial
statement or the element.

PSA 210 (Redrafted) required that the agreed terms of the audit engagement include
the expected form of any reports to be issued by the auditor. In the case of an audit of a
single financial statement, the auditor shall consider whether the expected form of
opinion is appropriate in the circumstances.

PSA 200 (Revised and Redrafted) states that PSAs are written in the context of an audit
of financial statements; they are to be adopted as necessary to the circumstances when
applied to audits of other historical financial information.
When forming an opinion and reporting on a single financial statement or on a specific element
of a financial statement, the auditor shall apply the requirements in PSA 700 (Redrafted),
adapted as necessary in the circumstances of the engagement.

If the auditor undertakes an engagement to report on a single financial statement or on a

specific element of a financial statement in a conjunction with an engagement to audit the
entity’s complete set of financial statements, the auditor shall express a separate of opinion for
each engagement.

If the opinion on the auditor’s report on an entity’s complete set of financial statements is
modified, or that report includes an Emphasis of Matter paragraph, the auditor shall determine
the effect that this may have on the auditor’s report on a single financial statement or on a
specific element of those financial statements. When deemed appropriate, the auditor shall
modify the opinion on the single financial statement or on the specific element f a financial
statement, or include an Emphasis of Matter paragraph or an Other Matter paragraph in the
auditor’s report, accordingly.

If the auditor concludes that it is necessary to express an adverse opinion or disclaim an

opinion on the entity’s complete set of financial statements as a whole, PSA 705 (Revised and
Redrafted) does not permit the auditor to include in the same auditor’s report an unmodified on
a single financial statement that forms part of those financial statements or on specific element
If the auditor concludes that it is necessary to express an adverse opinion or disclaim
an opinion on the entity’s complete set of financial statements as a whole but, in the
context of a separate audit of a specific element that is included in those financial
statements, the auditor nevertheless considers it appropriate to express an unmodified
opinion on that element, the auditor shall only do so if:

The auditor is not prohibited by law or regulation from doing so;

That opinion is expressed in an auditor’s report that is not published together with
the auditor’s report containing adverse opinion or disclaimer of opinion; and
The specific element does not constitute a major portion of the entity’s complete set
of financial statements.

The auditor shall not express an unmodified opinion on a single financial statement of a
complete set of financial statements if the auditor has expressed an adverse opinion or
disclaimed an opinion on the complete set of financial statements as a whole. This is
the case even if the auditor’s report on the single financial statement is not published
together with the auditor’s report containing the adverse opinion or disclaimer of
opinion. This is because a single financial statement is deemed tp constitute a major
portion of those financial statements.
INDEPENDENT AUDITOR’S REPORT

[Appropriate Addressee]

We have audited the accompanying balance sheet of ABC Company as at December 31, 20X1 and a summary of
significant accounting policies and other explanation (together “the financial statement”).

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair representation of this financial statements in accordance
with the Financial Reporting Framework in Jurisdiction X relevant to preparing such a financial statement; this
includes the design, implementation and maintenance of internal control relevant to the preparation of financial
statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
audit in accordance with Philippine Standards on Auditing. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of
material misstatement of the financial statements whether due to fraud or error In making those
risk assessment, the auditor considers internal control relevant to the entity’s preparation of the
financial statements in order to design audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our audit opinion.

Opinion

In our opinion, the financial statements present fairly, in all material respects, the financial position
of ABC Company as at December 31, 20X1 in accordance with those requirements of Financial
Reporting Framework in Jurisdiction X relevant to preparing such a financial statement.

Basis of Accounting

Without modifying our opinion, we draw attention Note X to the financial statements, which
describes the basis of accounting. The financial statements are prepared to assist the ABC
Company to meet the requirements of Regulator DEF. As a result, the financial statements may not
be suitable for another purpose.

[Auditor’s signature]

[ Date of the auditor’s report]

[Auditor’s address]
INDEPENDENT AUDITOR’S REPORT

[Appropriate Addressee]

We have audited the accompanying statement of cash receipts and disbursements of ABC Company for the year ended
December 31, 20X1 and a summary of significant accounting policies and other explanatory information (together “the
financial statement”). The financial statement has been prepared by management using the cash receipts and
disbursements basis of accounting in Note X.

Management’s Responsibility for the Financial Statement

Management is responsible for the preparation and fair presentation of this financial statement in accordance with the cash
receipts and disbursements basis of accounting described in Note X; this includes determining that the cash receipts
and disbursements basis of accounting is an acceptable basis for the preparation of the financial statement in the
circumstances, and the design, implementation and maintenance of internal control relevant to the preparation and fair
presentation of the financial statement that is free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on the financial statement based on our audit. We conducted our audit in
accordance with Philippine Standards on Auditing. Those standards require that we comply with ethical requirements
and plan and perform the audit to obtain reasonable assurance about whether the financial statement is free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statement. The procedures selected depend on the auditor’s judgment, including the assessment of
the risks of material misstatement of the financial statement, whether due to fraud or error. In making those
risks assessments, the auditors considers internal control relevant to the entity’s preparation and fair
presentation of the financial statement in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal
control. An audit also includes evaluating the overall presentation of the financial statement.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.

Opinion

In our opinion, the financial statement presents fairly, in all material respects, the cash receipts and
disbursements of ABC Company for the year ended December 31, 20X1 in accordance with the cash receipts
and disbursements basis of accounting described in Note X.

Basis of Accounting

Without modifying our opinion, we draw attention to Note X to the financial statement, which describes the
basis of accounting. The financial statement is prepared to provide information to |XYZ Creditor. As a result,
the statement may not be suitable for another purpose.

[Auditor’s signature]
[Date of the auditor’s report]
[Auditor’s address]
INDEPENDENT AUDITOR’S REPORT
[Appropriate Addressee]
We have audited the accompanying schedule of the liability for “incurred not reported” claims of ABC Insurance
Company as of December 31, 20X1 (“the schedule”). The schedule has been prepared by management based on
[describe the financial reporting provisions established by the regulator].
Management’s Responsibility for the Financial Statement

Management is responsible for the preparation of the schedule I accordance with {describe the financial reporting
provisions established by the regulator}; this includes the design, implementation and maintenance of internal
control relevant to the preparation of the schedule that is free from material misstatement, whether due to
fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on the schedule based on our audit. We conducted our audit in
accordance with Philippine Standards on Auditing. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether the schedule is free
from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
schedule. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of
material misstatement of the schedule, whether due to fraud or error. In making those risks assessments, the
auditor considers internal control relevant to the entity’s preparation of the schedule in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity’s internal control. An audit also includes evaluating the overall presentation of the
schedule.
We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial information in the schedule of the

liability for “incurred but not reported” claims to ABC Insurance
Company to meet the requirements of regulator DEF. as a result,
the schedule may not be suitable for another purpose. Our report
is intended solely for ABC Insurance Company and Regulator DEF
and should not be distributed to parties other than ABC Insurance
Company or Regulator DEF.

[Auditor’s Signature]

[Date of the auditor’s report]

[Auditor’s Address]
PSA 810 (Revised and Redrafted), “Engagement to
Report on Summary Financial Statements” deals
with the auditor’s responsibilities when undertaking
an engagement to report on summary financial
statements derived from financial statements
audited in accordance with PSA’s by that same
auditor.
Engagement Acceptance

The audit of the financial statements from which

the summary financial statements are derived provides
the auditor with the necessary knowledge to discharge
the auditor’s responsibilities in relation to the summary
financial statements in accordance with PSA.
Application of this PSA will not provide sufficient
appropriate evidence on which to base the opinion on
the summary financial statements if the auditor has not
also audited the financial statements from which the
summary financial statements are derived.
Management is responsible for the determination of the information that needs to be reflected in
the summary financial statements so that they are consistent, in all material respects, with or
represent a fair summary of the audited financial statements.
Factors that may affect the auditor’s determination of the acceptability of the applied criteria
include:
The nature of the entity;
The purpose of the summary financial statements;
The information needs of the intended users of the summary financial statements; and\
Whether the applied criteria will result in summary financial statements that are not
misleading in the circumstances

Timing of Work and Events Subsequent to the Date of the Auditor’s Report on the Audited
Financial Statements

When the auditor reports on the summary financial statements after the completion of the audit
of the financial statements, the auditor is not required to obtain additional audit evidence on
the audited financial statements, or report on the effects of events that occurred subsequent
to the date of the auditor’s report on the audited financial statements since the summary
financial statements are derived from the audited financial statements and do not update
them.
Elements of the Auditor’s Report

Title
A title indicating the report is the report of an independent auditor affirms
that the auditor has met all of the relevant ethical requirements regarding
independence.
Addressee
Factors that may affect the auditor’s evaluation of the appropriateness of the
addressee of the summary financial statements include the terms of the
engagement, the nature of the entity, and the purpose of the summary
financial statements.

Comparatives
If the audited financial statements contain comparatives, there is a
presumption that the summary financial statements also would contain
comparatives. Comparatives in the audited financial statements may be
regarded as corresponding figures or as comparative financial information