Member Since: Aug 11th 2017
President Johnson Global Accountancy Corp.
Sep 22nd 2017
Paragraph 2 of ISA 710 states " The nature of the comparative information that is presented in an entity's financial statements depends on the requirements of the applicable financial reporting framework."
So it's important to know what the framework and purpose for for the financials. (e.g. US GAAP, IFRS as issued by the IASB, or some other local GAAP). Once we know that, we have to look to those standards for any comparative requirement. Are these financials subject to any other regulatory requirements that might have rules on comparative requirements?
1.) You can skip comparative presentation but have to make sure that this will be in compliance with the requirements as stated above. If prior year wasn't audited this is the cleanest and most cost effective option.
2.) ISA 710 doesn't require you to present comparative F/S. Rather, it requires the auditor to ensure that presentation is in accordance with the framework. The Company should have a prior year trial balance that reconciles to prior year presentation of financial statements. If there is no data to back up the opening balances, it is hard for you to issue an opinion on any comparative amounts.
3.) Not exactly clear on your question; comparative amounts are always provided by management and a letter doesn't add much value. If you present comparative and mark the prior year balances and amounts as "audited", again, you'd have to ensure that this presentation is acceptable under the framework you are reporting under and any other regulatory requirements. This is usually not acceptable and in my cases we have gotten the consent/opinion from the prior year auditors on the comparative numbers, or, if no audit was done on the prior year, we needed to do the audit in order to opine on both years.
I hope this is helpful!