In This Issue:
1. IAASB Meetings
2. Arnold Schilder Reappointed To Chair IAASB From 2012-2014
3. Open for Comment - Exposure Draft of ISA 610, Using the Work of Internal Auditors, and ISA 315, Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment, and Proposed Impact Analysis Approach
4. Open for Comment - Exposure Draft of ISAE 3420, Assurance Reports on the Process to Compile Pro Forma Financial Information Included in a Prospectus
5. Existing and Forthcoming ISA Modules
6. Share IAASB eNews with Your Colleagues
7. Register for the 18th World Congress of Accountants in Kuala Lumpur, Malaysia on November 8-11, 2010
1. IAASB Meetings
The most recent IAASB meetings were held on June 14-18, 2010 in Mainz, Germany and on July 29, 2010 via teleconference.
In addition to the projects discussed in this eNews, the IAASB deliberated issues relating to the following projects:
- Revision of International Standard on Assurance Engagements (ISAE) 3000, Assurance Engagements Other than Audits or Reviews of Historical Financial Information
- Development of ISAE 3410, Assurance on a Greenhouse Gas Statement
- Authority of International Auditing Practice Statements (IAPSs), and development of revised IAPS 1012, Auditing Complex Financial Instruments
- Revision of International Standard on Review Engagements (ISRE) 2400, Engagements to Review Financial Statements
- Revision of International Standard on Related Services (ISRS) 4410, Engagements to Compile Financial Instruments
The IAASB will meet in Malta on September 20-24, 2010. As a reminder, all meeting agenda materials are publicly available and posted on the IAASB's website in advance of IAASB meetings. In addition, audio recordings are posted after the meetings.
2. Arnold Schilder Reappointed To Chair IAASB From 2012-2014
The IFAC Board has reappointed Prof. Arnold Schilder to lead the IAASB for the period 2012-2014.
Prof. Schilder's appointment to a second three-year term as IAASB Chairman begins on January 1, 2012. The appointment was approved by the Public Interest Oversight Board-an independent body that oversees IAASB activities-at its latest meeting in Madrid, Spain on June 28-29, 2010.
3. Open for Comment - Exposure Draft of ISA 610, Using the Work of Internal Auditors, and ISA 315, Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment, and Proposed Impact Analysis Approach
The IAASB has issued an Exposure Draft (ED) for the proposed revision of ISA 610, Using the Work of Internal Auditors. The standard is being revised in recognition of developments in the internal auditing environment as well as the evolving relationship between internal and external auditors.
The proposed revision addresses the responsibilities of the external auditor as they relate to using the work of an entity's internal auditor during an audit. In particular, the new standard aims to enhance the performance of external auditors by providing them a stronger framework for evaluating, as well as using, the work and assistance of internal auditors. Related enhancements concerning the external auditor's required considerations of the internal audit function have been proposed in ISA 315, Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment, which is also part of the ED.
In addition to setting out the IAASB's main proposals for the revised standards, the ED's explanatory memorandum outlines a pilot approach for analyzing the benefits and impacts of these proposals. This approach provides a structured and transparent means for communicating the effects of proposals to stakeholders. The pilot will help inform the IAASB as well as lead to the further integration of the analysis of benefits and impacts into the standard-setting process. The IAASB's pilot is the first step in the development of an impact analysis process for use throughout IFAC. Other independent standard-setting boards plan to test this process in future projects.
The IAASB invites all stakeholders to comment on its proposals. To access the exposure draft or submit a comment, visit the IAASB's website. Comments for this ED are requested by November 15, 2010.
4. Open for Comment - Exposure Draft of ISAE 3420, Assurance Reports on the Process to Compile Pro Forma Financial Information Included in a Prospectus
In April 2010, the IAASB released its Exposure Draft (ED) of proposed ISAE 3420, Assurance Reports on the Process to Compile Pro Forma Financial Information Included in a Prospectus. The proposed standard deals with the practitioner's responsibilities when reporting on whether the process of compiling pro forma financial information for inclusion in an issuer's prospectus has been properly followed.
The proposed standard is particularly relevant in light of the growing number of cross-border securities offerings and the globalization of capital markets. It provides comprehensive guidance on engagement acceptance considerations and on the nature and extent of the practitioner's work. It also provides an illustrative report arising from such an engagement.
The IAASB invites all stakeholders to comment on its proposals. To access the exposure draft or submit a comment, visit the IAASB's website. Comments should be submitted using the online comment system by September 30, 2010.
5. Existing and Forthcoming ISA Modules
IAASB staff has developed a series of ISA Modules focusing on some of the new and more significantly revised ISAs.
Each module consists of a short video and slides that explain the key principles of, and major changes in, individual ISAs. This non-authoritative material is designed to be of assistance to auditors in the field, trainers, and those responsible for promoting adoption and implementation of the clarified ISAs. ISA modules may be downloaded free of charge from the IAASB Clarity Center. The IAASB encourages IFAC members, associates, regional accountancy bodies, and firms to use these materials and to promote their availability to their members and employees.
IAASB staff is currently developing three new modules, planned for release in October 2010. The new modules are:
- Materiality, Misstatements and Reporting
- Using the Work of an Auditor's Expert
- Written Representations
6. Share IAASB eNews with Your Colleagues
The IAASB issues regular eNews updates to keep you appraised of the board's activities and recent publications. Please forward this eNews to any interested colleagues and let them know they can subscribe to this and other eNews bulletins.
7. Register for the 18th World Congress of Accountants in Kuala Lumpur, Malaysia on November 8-11, 2010
The 18th World Congress of Accountants, hosted by the Malaysian Institute of Accountants and IFAC, is November 8-11, 2010. The theme of the congress will be "Accountants: sustaining value creation". The Congress will offer more than thirty panel discussions and speakers from The World Bank, Transparency International, the Financial Stability Board, the European Commission, IFIAR, and the IASB, among others. Thousands of delegates representing the profession from around the world will attend.
For more information about any of the items mentioned above or other information about IFAC, please contact communications@ifac.org.
About the IAASB
The IAASB (www.iaasb.org) develops auditing and assurance standards and guidance for use by all professional accountants under a shared standard-setting process involving the Public Interest Oversight Board, which oversees the activities of the IAASB, and the IAASB Consultative Advisory Group, which provides public interest input into the development of the standards and guidance. The structures and processes that support the operations of the IAASB are facilitated by IFAC.
About IFAC
IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 159 members and associates in 124 countries and jurisdictions, representing more than 2.5 million accountants in public practice, education, government service, industry, and commerce. Through its standard-setting boards, IFAC sets international ethics, auditing and assurance, education, and public sector accounting standards. It also issues guidance to encourage high-quality performance by professional accountants in business.
