Narrow Scope Amendments to ISA 700 (Revised), Forming an Opinion and Reporting on Financial Statements, and ISA 260 (Revised), Communication with Those Charged with Governance
New resources from the International Auditing and Assurance Standards Board (IAASB) are now available to help stakeholders understand, implement, and use the new standard for audits of smaller and less complex entities (the ISA for LCE). A comprehensive new three-part video series is now available and registration has opened for a global webinar.
Navigating the ISA for LCEVideo Series
The newly released video series details important aspects of the standard.
Exploring the Benefits: Learn more about the objectives, benefits, and its distinguishing features compared to the full suite of ISAs.
A Closer Look at Applicability and Use: Understand the conditions under which the standard can be applied, including the role of legislative and regulatory authorities.
A Step-by-Step Walkthrough: Gain an in-depth understanding of the standard’s design principles, structure, and content layout.
Global Webinar: Understanding the ISA for LCE
Don’t miss the opportunity to gain a comprehensive overview of the ISA for LCE.
Date/Time: April 3, 2024 at 7:00-8:30 am ET
Venue: Zoom with livestreaming on YouTube and LinkedIn
Agenda: Key topics include the standard’s purpose, authority, structure and associated benefits
In addition to the webinar and video series, the IAASB will also issue supplementary guidance, a fact sheet on adoption, and a first-time implementation guide in 2024. All materials will be available on the IAASB website: www.iaasb.org/ISAforLCE
Amy Groves is a Managing Director at Deloitte & Touche LLP. She currently works for both the US and Global firms, with a focus on the interpretation, implementation and execution of international and US-issued audit and assurance professional standards in Deloitte's methodology. Ms. Groves has over 18 years of experience in auditing public and private clients, including extensive experience working with engagement teams in all industries from all over the world.
Ms. Groves is a Certified Public Accountant (California, Connecticut) and is a member of the AICPA. She holds a Bachelors of Sciences in Accounting from the University of Southern California.
Proposed Narrow Scope Amendments to ISQMs, ISAs, and International Standard on Review Engagements 2400 (Revised), Engagements to Review Historical Financial Statements
The International Auditing and Assurance Standards Board (IAASB) today proposed a significant strengthening of its standard on auditors’ responsibilities relating to fraud. Recent corporate failures throughout the world have underscored the benefits of clarifying and enhancing the role of auditors in responding to fraud and suspected fraud as a means of enhancing public trust in financial reporting.
IAASB Chair Tom Seidenstein emphasized that the proposed revisions define the expectations in relation to fraud, delineate more robust procedures, and increase transparency about the auditors’ responsibilities and fraud-related procedures in the auditor’s report. “While many participants in the financial reporting ecosystem, particularly management and those charged with governance, have a role in preventing fraud, our standard focuses on the key role that auditors play. While auditors are not policemen, they can and must play a role in identifying and responding to material misstatements of the financial statements due to fraud and communicating their work to users. This proposed standard is an important step forward,” said Mr. Seidenstein.
Key Changes in the Proposed Revisions The proposed revisions to International Standard on Auditing 240 (Revised), The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements, include:
Clarified auditor responsibilities relating to fraud in an audit.
Emphasized professional skepticism to ensure auditors remain alert to possible fraud and exercise professional skepticism throughout an audit.
Strengthened identification and assessment of risks of material misstatement due to fraud.
Clarified response to fraud or suspected fraud identified during the audit.
Increased ongoing communication with management and those charged with governance about fraud.
Increased transparency about auditors’ responsibilities and fraud-related procedures in the auditor’s report.
Enhanced audit documentation requirements about fraud-related procedures.
Video Series Planned to Facilitate Understanding During the consultation period, IAASB will release a videos series to help stakeholders understand the proposed revisions and their implications for strengthening the financial reporting ecosystem. Stay updated on upcoming events by following the IAASB on LinkedIn and/or X (formerly Twitter) and register/subscribe to our mailing list.
How to Provide Feedback The IAASB invites all stakeholder to submit their comments using the Response Template, designed to facilitate a structured response and streamline feedback collation and analysis. Respondents are encouraged to share their insights by June 5, 2024.
