SA 710 requires the auditor to obtain sufficient appropriate evidence that comparative information is correctly presented and appropriately classified, and distinguishes two frameworks: corresponding figures (an integral part of the current period statements, not referred to separately in the opinion) and comparative financial statements (a complete set in their own right, on which a separate opinion is expressed). Under the corresponding-figures framework, which is what most Indian statutory audits use, the opinion refers only to the current period, but if the prior period was modified and that matter remains unresolved, the auditor's opinion this year must still be modified in respect of the corresponding figures.
The two frameworks, and why the difference matters
| Framework | What the opinion covers | Typical use |
|---|---|---|
| Corresponding figures | Current period only — prior-year numbers are part of the current statements for context, not opined on separately | Indian companies' financial statements under Schedule III |
| Comparative financial statements | Each period presented, separately, as if it were a complete set of statements | Some group reporting packages and certain cross-border reporting formats |
What has to happen when the prior period was modified
- 01Check whether the matter giving rise to the prior modification is resolvedA qualification for an unresolved litigation, for instance, may still be live this year even if the amount has changed.
- 02If unresolved and material, modify this year's opinion with respect to the corresponding figuresUnder the corresponding-figures framework, the current report still has to carry the modification forward if the underlying matter isn't resolved.
- 03If resolved, consider whether an emphasis of matter is still warrantedEven where a matter is now resolved, disclosure about how it was resolved may be relevant enough to reference under SA 706.
Regulatory requirement
If the prior period's financial statements were audited by a predecessor auditor, SA 710 requires the current auditor to either state that fact in an Other Matter paragraph, or, where permitted and the predecessor's report is available, refer to the predecessor's report and the date it was issued.
Comparative figures that are unaudited (e.g. restated management figures with no audit opinion attached) still need a clear reference in the report stating that fact — silence about the comparatives' audit status is not an option under SA 710.
This is practical guidance written for audit teams, not an authoritative statement of any standard or statute. Standards, forms and timelines change. Check the current text issued by the ICAI and the relevant authority before relying on anything here in an audit file.
Related resources
- Audit workflow & automationSA 705: qualified, adverse or disclaimer — choosing the right modified opinionTwo questions decide which modification applies, and they're genuinely independent of each other — getting one right doesn't tell you the other.
- Audit workflow & automationSA 706: emphasis of matter and other matter paragraphs, and when each appliesBoth paragraphs sit inside an unmodified opinion. The difference is what they're pointing at — something already in the financial statements, or something outside them.
- Audit workflow & automationSA 560: subsequent events, and the three periods the standard treats differentlyThe auditor's responsibility for subsequent events doesn't end on one fixed date. It changes shape across three separate windows, each with a different obligation.
- Audit workflow & automationSA 700: forming an opinion, and what "true and fair" actually requires concluding onFinishing every planned procedure isn't the same as forming an opinion. SA 700 is the step that happens after the checklist, not instead of it.
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