CA Paras has accepted audit of financial statements of an entity. According to the Standards on Auditing, the auditor is required to send an audit…

Key areas that should be included in Audit engagement letter are: (i) The objective and scope of the audit of the financial statements; (ii) The responsibilities of the auditor; (iii) The responsibilities of management; (iv) Identification of the applicable financial reporting framework for the preparation of the financial statements and (v) Reference to the expected form and content of any reports to be issued by the auditor and a statement that there may be circumstances in which a report may differ from its expected form and content. If law or regulation prescribes in sufficient detail the terms of the audit engagement, the auditor need not record them in a written agreement, except for the fact that such law or regulation applies and that management acknowledges and understands its responsibilities.