Document background
The Audit Plan Risk Assessment is a critical document required under Hong Kong Standards on Auditing for planning and executing an effective audit engagement. It is prepared at the initial phase of the audit process to identify, assess, and document risks of material misstatement in the financial statements. The document incorporates specific considerations mandated by Hong Kong regulatory requirements, including those under the Hong Kong Companies Ordinance, Professional Accountants Ordinance, and relevant financial reporting standards. This assessment forms the basis for determining the nature, timing, and extent of audit procedures, ensuring compliance with both local and international auditing standards. It is particularly crucial in Hong Kong's complex business environment, where entities often engage in cross-border transactions and face sophisticated business risks.
