Our third auditor's report snapshot, provides insights and observations on Key Audit Matters from 56 entities in the ASX 500 with 31 December 2016 year ends. Key Audit Matters (KAMs) are those matters that required significant auditor attention in performing the audit, and are communicated in auditor’s reports of listed entities.
Our analysis highlights the top four KAM topics, representing over 40 percent of all KAMs communicated. It provides industry specific observations and deep-dive analysis, sharing patterns you may not have expected. Read the full report for our full analysis.
Including Key Audit Matters in audit reports of listed entities results from a new auditing standard, adopted for 31 December 2016 year-ends and onwards. It is the biggest change auditors have seen to the auditing standards since the introduction of the clarity standards in 2004. The platform for change was to provide insights to shareholders on the performance of the audit, previously only viewed by those in the boardroom. We analysed those entities in the ASX 500 with 31 December 2016 year-ends.
 Series 1 Auditor’s Report Snapshot issued on 31 August 2016 highlighted our observations from 16 enhanced audit reports published for 30 June 2016 audits, adopting early the requirements of ASA 701Communicating Key Audit Matters in the Independent Auditor’s Report. Series 2 Auditor’s Report Snapshot issued on 30 September 2016 updated Series 1 for further early adopters and trends exhibited thereon.
 Based on auditor’s reports KPMG viewed between 1 January and 28 March 2017 of ASX 500 with 31 December 2016 year ends applying exclusively the Australian auditing standards.
 Key Audit Matters (KAMs) are those matters that required significant auditor attention in performing the audit, ASA 701Communicating Key Audit Matters in the Independent Auditor’s Report, as issued by the Australian Auditing and Assurance Standards Board. ASA 701 is operative for the audits of general purpose financial reports of listed entities with years ended on or after 15 December 2016.