[The following paragraph was effective for audits of financial statements for periods beginning on or after June 15, 2003. It was amended, effective for audits of fiscal years beginning on or after December 15, 2010. See PCAOB Release No. 2010-004.

Return to the current version.]


Section 319, Consideration of Internal Control in a Financial Statement Audit, as amended, requires the auditor to obtain an understanding of each of the five components of internal control sufficient to plan the audit. In the specific context of this section, the auditor obtains such an understanding related to the determination of the entity’s fair value measurements and disclosures in order to plan the nature, timing, and extent of the audit procedures.