SA 700 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
SA 700 lays down what an independent auditor's report on financial statements must contain. This second part walks through each element in order, explains the wording the standard requires, and covers reports prescribed by law, reports that also follow other standards, and supplementary information.
SA 700 (Revised), as effective for audits of financial statements for periods beginning on or after 1 April 2018, applies to a complete set of general purpose financial statements. ICAI may revise standards, so check icai.org for the current text. Companies that keep their books of accounts current find the report stage smoother. Part 1 is at SA 700 part 1.
The report is written, has a title showing it is the report of an independent auditor, an addressee, and begins with an Opinion section followed directly by a Basis for Opinion section. Further sections cover going concern, key audit matters (compulsory for listed entities), other information, management's responsibilities, the auditor's responsibilities, and, if needed, a separate section on other legal and regulatory requirements. The report is signed by the engagement partner with membership number, shows place, and is dated no earlier than the date sufficient evidence was obtained and the statements were approved.
The elements in order
| Element | What the standard requires | Paragraph |
|---|---|---|
| Written report | Hard copy or electronic | 20 (A13) |
| Title | Clearly indicates the report of an independent auditor, for example "Independent Auditor's Report" | 21 (A15) |
| Addressee | As appropriate to the engagement, often the shareholders or those charged with governance | 22 (A16) |
| Opinion | First section, headed "Opinion" | 23-27 |
| Basis for Opinion | Directly after Opinion | 28 |
| Going concern | Where applicable, reported under SA 570 | 29 |
| Key audit matters | Listed entities; others where law requires or the auditor decides | 30-31 |
| Other information | Where applicable, under SA 720 | 32 |
| Responsibilities for the statements | Management and, where different, those charged with governance | 33-36 |
| Auditor's responsibilities | Required statements about the audit | 37-42 |
| Other reporting responsibilities | Separate section if any | 43-45 |
| Signature, place, date | Required | 46-48 |
Apart from the Opinion and Basis for Opinion sections, the standard does not fix the order of the elements, but it requires specific headings so that reports can be recognised as SA reports (see the note under A14).
Opinion (paragraphs 23-27)
The Opinion section identifies the entity, states that the statements have been audited, names each statement, refers to the notes including the summary of significant accounting policies, and specifies the date or period each covers (paragraph 24). A18 suggests giving page numbers where the statements sit in a document with other information.
For a fair presentation framework, the unmodified opinion uses one of two equivalent phrases: the statements "present fairly, in all material respects", or "give a true and fair view" (paragraph 25, A19). For a compliance framework, the opinion is that the statements are prepared, in all material respects, under the framework (paragraph 26). The opinion covers the complete set as the framework defines it (A21). For companies preparing statements under the Companies (Indian Accounting Standards) Rules, 2015, the matters presented are the state of affairs at the year-end and the profit or loss, changes in equity where applicable, and cash flows for the year (A22). If the framework is not Accounting Standards, the opinion identifies its origin (paragraph 27). The framework is named in terms such as the Accounting Standards prescribed under section 133 of the Companies Act, 2013, or ICAI's Accounting Standards, or IFRS (A23-A24). Where two frameworks apply, the opinion refers to both (A25).
Basis for Opinion (paragraph 28)
This section follows the Opinion directly and:
- states that the audit was conducted in accordance with Standards on Auditing;
- refers to the section describing the auditor's responsibilities;
- states that the auditor is independent of the entity under the relevant ethical requirements and has fulfilled other ethical responsibilities, referring to the Code of Ethics issued by ICAI; and
- states whether the auditor believes the evidence obtained is sufficient and appropriate to provide a basis for the opinion.
The section gives important context to the opinion (A27).
Going concern, key audit matters, other information (paragraphs 29-32)
Where applicable, the auditor reports under SA 570 (see SA 570 part 2). For complete sets of general purpose statements of listed entities, key audit matters must be communicated under SA 701; they must also be where law requires or the auditor decides (paragraphs 30-31; see SA 701). Reporting on other information follows SA 720 (paragraph 32; see SA 720 part 2).
Responsibilities for the financial statements (paragraphs 33-36)
A section headed "Responsibilities of Management for the Financial Statements" uses the term appropriate in the legal framework (paragraph 33). It describes management's responsibility for preparing the statements under the framework and for internal control the management considers necessary for statements that are not materially misstated, and for assessing the entity's ability to continue as a going concern, with a description of when that basis is appropriate (paragraph 34). If those responsible for oversight differ from those responsible for preparation, the section also identifies them and its heading refers to those charged with governance (paragraph 35). In a fair presentation framework, it refers to "the preparation and fair presentation" or to statements that give a true and fair view (paragraph 36).
Auditor's responsibilities (paragraphs 37-42)
A section headed "Auditor's Responsibilities for the Audit of the Financial Statements" states the following (paragraphs 38-40):
| Statement | Content |
|---|---|
| Objectives | Obtain reasonable assurance that the statements as a whole are not materially misstated, and issue a report with an opinion |
| Meaning of reasonable assurance | A high level of assurance, but not an absolute one that an audit will always detect a material misstatement |
| Materiality | Misstatements from fraud or error are material if they could reasonably influence users' economic decisions (or a definition from the framework) |
| Judgement and skepticism | Exercised throughout the audit |
| Description of an audit | Risk assessment and responsive procedures, with the risk of not detecting fraud higher than for error; understanding of internal control, not for an opinion on its effectiveness; evaluating policies, estimates and disclosures; concluding on going concern and material uncertainty, based on evidence up to the report date; evaluating overall presentation for a fair presentation framework |
| Communication with governance | Planned scope and timing, significant findings and deficiencies in internal control; a statement on compliance with ethical requirements and independence; and, where KAMs are reported, how they are determined |
The description may be placed in the body of the report, in an appendix referred to in the report, or, if law or the standards expressly permit, by reference to a description on a website of an appropriate authority, in which case the auditor checks that the description is consistent with the requirements (paragraphs 41-42; A49-A52). It may be tailored to the entity, for instance for consolidated statements (A45).
Other reporting responsibilities (paragraphs 43-45)
If the auditor reports on matters beyond the SAs, they go in a separate section headed "Report on Other Legal and Regulatory Requirements" or similar, unless they address the same topics as the SA reporting, in which case they may be combined but must be clearly differentiated (paragraphs 43-44). When there is a separate section, the SA content sits under "Report on the Audit of the Financial Statements" and the other section follows it (paragraph 45). For companies, this is where matters such as the Companies (Auditor's Report) Order are reported; see our CARO guidance on the form of report and reasons for unfavourable answers and Rules 11 and 12 of the Companies (Audit and Auditors) Rules, 2014.
Signature, place and date (paragraphs 46-48)
The report is signed by the engagement partner in personal name and, where a firm is appointed, also in the firm's name. The partner or proprietor mentions the ICAI membership number and the firm registration number, where allotted (paragraph 46). A footnote records an ICAI Council decision on the firm registration number and refers to the Companies Act, 1956 as printed; the Companies Act, 2013 now applies, and our section 139 post covers appointment. Naming the partner adds transparency (A56). The report names the location, ordinarily the city of signature (paragraph 47).
The date is no earlier than the date the auditor has sufficient appropriate evidence, including that all statements and notes have been prepared and those with recognised authority have taken responsibility (paragraph 48). The date shows the auditor considered events up to that date (A58); see SA 560.
Reports prescribed by law, other standards and supplementary information
If law requires a specific layout or wording, the report refers to SAs only if it includes at least a list of elements, from title and addressee to signature, place and date (paragraph 49). If the audit is also under International Standards on Auditing or another jurisdiction's standards, the report may refer to both only if there is no conflict and the minimum elements are included, with the other standards clearly identified (paragraphs 50-51). Supplementary information not required by the framework is covered by the opinion if it is an integral part; otherwise it must be clearly differentiated, or the report must say it is unaudited (paragraphs 52-53). The standard's appendix contains illustrative reports; they are not copied here, and the live draft linked below shows a worked layout.
Illustrative example
Brightwell Foods Ltd is an invented listed company; all dates are illustrative. The report is headed "Independent Auditor's Report", addressed to the members, with Opinion, Basis for Opinion, Key Audit Matters, Other Information, the two responsibilities sections and a separate Report on Other Legal and Regulatory Requirements. The partner signs with membership and firm registration numbers, names the city, and dates it 24 May, the day after the board approved the statements. A date of 20 May, before approval, would not be allowed.
Need help with the report pack?
Report finalisation depends on board approval dates, complete notes and a clear list of other statutory reports. TaxClue's books of accounts compliance support can help you prepare the schedules and notes that go with the audit report. For the tax audit report, see SA 700 and the prescribed format for tax audit.
Key takeaways
- The Opinion section comes first, followed directly by Basis for Opinion.
- Key audit matters are mandatory for listed entities.
- The standard prescribes headings and statements for responsibilities.
- Other legal reporting sits in a separate section unless the topics coincide.
- The report is dated no earlier than approval of the statements and sufficient evidence.
Read next
- SA 700 part 1: forming an opinion
- SA 701: key audit matters
- SA 720 part 2: other information section
- Standalone auditor's report format
Disclaimer: Based on the Standards on Auditing and quality standards issued by the Institute of Chartered Accountants of India, in the versions named in the article, and ICAI's announcement of 31 March 2026 on SQM 1 and SQM 2, as consulted on 3 October 2026. ICAI revises standards from time to time; check the current text and effective dates on icai.org. This article is general information, not legal advice; check the official text before acting.