Wing Ltd. has appointed CA G as its statutory auditor for FY 2024–25. During preliminary discussions, CA G observes that the company prepares…

As per SA 210 “Agreeing the Terms of Audit Engagements”, in order to establish whether the preconditions for an audit are present, the auditor of Wing Ltd, CA G shall: (1) Determine whether the financial reporting framework is acceptable; and (2) Obtain the agreement of management that it acknowledges and understands its responsibility: (i) For the preparation of the financial statements in accordance with the applicable financial reporting framework; (ii) For the internal control as management considers necessary; and (iii) To provide the auditor with: Access to all information such as records, documentation and other matters;Additional information that the auditor may request from management for the purpose of the audit; andUnrestricted access to persons within the entity from whom the auditor determines it necessary to obtain audit evidence. Since the management of Wing Ltd. has not acknowledged its responsibilities and is restricting access to information and personnel, the preconditions for an audit are not present as per SA 210. Therefore, CA G should decline the engagement, unless the management agrees to fulfil all obligations required under SA 210 before the audit begins.