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📚 Learn/ / SA 710 — Comparative Information: Corresponding Figures and Comparative Financial Statements
Microlesson · 5-min read

Definitions, Audit Procedures, and Opinion Requirements for Comparative Information

## SA 710 — Comparative Information

### Three Core Definitions

#### 1. Comparative Information

  • Amounts and disclosures included in the FS
  • In respect of one or more prior periods
  • In accordance with the Applicable Financial Reporting Framework (AFRF)

#### 2. Corresponding Figures

  • Comparative information where prior period amounts/disclosures are included as part of the current period FS
  • Intended to be read only in relation to current period figures
  • Not presented as complete standalone financial statements
  • Are an integral part of the current period FS

#### 3. Comparative Financial Statements

  • Prior period information included for comparison
  • If audited, the prior period FS are referred to in the auditor's opinion
  • The level of information is comparable to the current period FS

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### Critical Reporting Difference

ApproachAuditor's Opinion Covers
Corresponding FiguresCurrent period only
Comparative Financial StatementsEach period for which FS are presented

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### Audit Procedures for Comparative Information

The auditor must:

1. Agree prior period figures — Verify that comparative info agrees with amounts/disclosures in the prior period FS

2. Check accounting policy consistency — Ensure policies are consistent across periods; if changed, verify proper accounting and disclosure

3. Investigate possible misstatements — If a possible material misstatement in comparative info is discovered during the current period audit, perform additional procedures to determine whether it exists

4. Follow SA 560 — If the auditor also audited prior period FS, apply SA 560 (Subsequent Events) requirements

5. Written Representations (SA 580) — Request WR for all periods referred to in the opinion. Also obtain a specific WR for any prior period item separately disclosed in the current year Statement of P&L

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### When the Auditor's Opinion MUST Refer to Corresponding Figures

Normally the opinion on corresponding figures refers only to the current period. However, reference is required in four cases:

#### Case 1: Prior Report Was Modified

Sub-caseTreatment
Matter is resolved and properly accounted for / disclosedCurrent period opinion need not refer to the prior modification
Matter is unresolvedAuditor shall modify the current period opinion

#### Case 2: Material Misstatement in Prior Period (Previously Unmodified Opinion)

  • Auditor obtains audit evidence that a material misstatement exists in prior period FS on which an unmodified opinion was previously issued
  • Auditor checks whether the misstatement has been dealt with under AFRF
  • If not dealt with → express a qualified or adverse opinion on current period FS

#### Case 3: Prior Period Audited by a Predecessor Auditor

If permitted by law/regulation to refer to the predecessor's report, include an Other Matter paragraph stating:

  • (a) Prior period FS were audited by the predecessor auditor
  • (b) Type of opinion expressed (and if modified, the reasons)
  • (c) Date of the predecessor's report

#### Case 4: Prior Period FS Were Not Audited

  • State in an Other Matter paragraph that the corresponding figures are unaudited
  • This does not relieve the auditor of obtaining SAAE that opening balances are free from material misstatements affecting the current period

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### Comparative Financial Statements — Additional Rules

(A) Opinion must refer to each period — When comparative FS are presented, the auditor's opinion shall refer to each period for which FS are presented.

(B) Differing opinion from prior year — If the auditor's current opinion on prior period FS differs from the opinion previously expressed, the auditor shall disclose the substantive reasons in an Other Matter paragraph (per SA 706).

(C) Prior period audited by predecessor — Include an OM paragraph (same (a), (b), (c) as Case 3 above). Additionally:

  • If a material misstatement exists in prior period FS (previously reported without modification by predecessor), communicate with management/TCWG and request that the predecessor auditor be informed
  • If the prior period FS are amended and the predecessor issues a new report on those amended FS → the current auditor reports only on the current period

(D) Prior period not audited — State in an OM paragraph that corresponding figures are unaudited (same rule as Case 4 for corresponding figures).

Worked example

### Example 1

Case 1 – Resolved modification: In FY 2024, the auditor issued a qualified opinion due to inventory valuation. In FY 2025, management corrects the valuation method and properly restates the comparative figures. The FY 2025 opinion need not refer to the prior qualification — the matter is resolved.

### Example 2

Case 1 – Unresolved modification: Same scenario, but management refuses to correct the FY 2024 inventory figures in the comparatives. The unresolved matter carries forward — the auditor modifies the FY 2025 opinion.

### Example 3

Case 2 – Previously clean opinion, new evidence of MMS: The FY 2025 audit uncovers evidence that FY 2024 revenue was overstated (undetected during the FY 2024 audit, which had an unmodified opinion). Management does not restate. The auditor must issue a qualified or adverse opinion on the FY 2025 FS.

### Example 4

Case 3 – Predecessor auditor: XYZ & Co. audits ABC Ltd for FY 2025. The FY 2024 comparatives were audited by PQR & Co. XYZ & Co. includes an OM paragraph: 'The financial statements of the prior period ended 31 March 2024 were audited by PQR & Co., who expressed an unmodified opinion dated 15 May 2024.'

### Example 5

Written Representation example: During the FY 2025 audit, a prior year contingent liability (disclosed separately in the P&L note) is still outstanding. The auditor must obtain a specific written representation from management addressing that prior year item in addition to the standard WR covering all periods in the opinion.

⚠️ Common exam mistakes

  • Confusing 'corresponding figures' with 'comparative financial statements': corresponding figures are NOT standalone — they can only be read alongside current year figures. Comparative FS are standalone for each period.
  • Forgetting that the auditor's opinion on corresponding figures covers ONLY the current period — not the prior year.
  • Assuming that an OM paragraph saying 'figures are unaudited' removes the obligation to check opening balances — SA 710 explicitly states it does not.
  • In Case 1, applying modification to current period when the matter is resolved — if properly accounted for and disclosed, no reference to prior modification is needed.
  • Overlooking the requirement to obtain written representations for ALL periods referred to in the opinion, not just the current year.
  • In comparative FS (not corresponding figures), forgetting that each period needs its own opinion expression.
Bare-Act text SA 710, Paragraph 2 (Definitions) and Paragraphs 7–17 · SA 710 — Comparative Information — Corresponding Figures and Comparative Financial Statements · click to expand
For corresponding figures, the auditor's opinion on the financial statements refers to the current period only; whereas for comparative financial statements, the auditor's opinion refers to each period for which financial statements are presented.
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