Abstract
Abstract : The audit report is the primary document through which auditors communicate their opinion on the fair presentation of financial statements to users. The new audit report format, which came into effect in 2016, introduces a number of changes. One of the most important changes is the requirement that all public entities disclose items that are deemed of greatest significance in the audit, namely, Key Audit Matters. Through these changes, the new audit report format seeks to address the audit expectation gap. The purpose of this study was to analyse whether the top 40 listed entities on the Johannesburg Stock Exchange disclosed Key Audit Matters according to the new reporting standards and to determine the nature of these items. Using a content analysis methodology, the findings revealed that 130 Key Audit Matters were raised by the study population and that the three disclosure requirements of the new reporting standards were met, namely, (i) why the matter was considered to be of most significance in the audit and therefore deemed a Key Audit Matter, (ii) how the matter was addressed in the audit and (iii) whether reference was made to the related disclosure, if any, in the financial statements. Study limitations were noted and recommendations on addressing the issue were provided.