ED 84 is part of phase two of the IPSASB’s Leases project. It proposes amendments to IPSAS 43, Leases on accounting for concessionary leases, as well as new guidance on right-of-use assets in-kind and consequential amendments to IPSAS 23, Revenue from Non-Exchange Transactions (Taxes and Transfers).
“In light of the responses to the RFI, the IPSASB decided to propose new guidance on concessionary leases and right-of-use assets in-kind,” said IPSASB Chair Ian Carruthers. “The proposals in ED 84 will provide new guidance that will enhance transparency, accountability, and decision-making in the public sector.”
How to Comment To access the Exposure Draft, its summary At-a-Glance document, and the Feedback Statement or to submit a comment, visit the IPSASB website. Comments are requested by May 16, 2023. The IPSASB encourages IFAC members, associates, and regional accountancy organizations to promote the availability of this Consultation Paper to their members and employees. About the IPSASB The International Public Sector Accounting Standards Board (IPSASB) works to strengthen public financial management globally through developing and maintaining accrual-based International Public Sector Accounting Standards® (IPSAS®) and other high-quality financial reporting guidance for use by governments and other public sector entities. It also raises awareness of IPSAS and the benefits of accrual adoption. The Board receives support from the Asian Development Bank, the Chartered Professional Accountants of Canada, the New Zealand External Reporting Board, and the governments of Canada and New Zealand. The structures and processes that support the operations of the IPSASB are facilitated by the International Federation of Accountants (IFAC). For copyright, trademark, and permissions information, please go to permissions or contact permissions@ifac.org.
About the Public Interest Committee The governance and standard-setting activities of the IPSASB are overseen by the Public Interest Committee (PIC), to ensure that they follow due process and reflect the public interest. The PIC is comprised of individuals with expertise in public sector or financial reporting, and professional engagement in organizations that have an interest in promoting high-quality and internationally comparable financial information.
Stakeholder comments on Exposure Draft 84 sought by May 17, 2023
The Fast Future With IFAC is a conversational podcast series about small- and medium-sized practicies (SMPs) adapting to the rapidly changing global economy.
Episode Six features a conversation with Hamish Mexted, Founder and Director of Convex Accounting.
We spoke to Hamish about his experience with a range of pressing topics for SMPs, including:
Cybsercurity and cloud computing
Communication and relationship-building with clients
Attracting and retaining talent
Innovation in the firm
Click below or visit IFAC's iTunes podcast channel to listen to this episode.
The International Auditing and Assurance Standards Board (IAASB) today issued a public consultation for its 2024-2027 proposed strategy and work plan. The strategy seeks to accelerate the actions originally laid out in the 2020-2023 strategy with a focus on standard setting that supports the performance of high-quality audit and assurance engagements.
“Audit and assurance play vital roles in the world’s economies. At their best, audit and assurance practitioners enhance trust in markets and assist in efficient, sustainable resource allocation,” noted IAASB Chair Tom Seidenstein. “Our proposed new strategy strives to develop the globally accepted standards for audit, assurance and related services that enable high-quality engagements, with a distinct focus on both the core need for audits of financial statements and the growing demand for sustainability assurance engagements.”
The proposed strategy outlines four strategic objectives:
Support the consistent performance of quality audit engagements by enhancing our auditing standards in areas where there is the greatest public interest need;
Establish globally accepted standard(s) for assurance on sustainability reporting;
Strengthen coordination with the International Ethics Standards Board for Accountants and other leading standard setters and regulators to leverage better collective actions in the public interest; and
Create more agile, innovative ways of working in line with the Monitoring Group’s reform vision.
The IAASB’s 2024-2027 work plan describes the technical standard-setting work required to support the strategy. The work plan focuses on where further standards’ development can best contribute to meeting the needs of stakeholders in the external reporting ecosystem, while balancing timeliness with quality.
The IAASB invites all stakeholders to comment on the proposed strategy and work plan via the IAASB website by April 11, 2023. Stakeholders can respond to all questions in the Consultation Paper or focus on those questions that are most relevant to them and where they have specific comments.
This proposed strategy seeks to accelerate the actions originally laid out in the 2020-2023 strategy with a focus on standard setting that supports the performance of high-quality audit and assurance engagements.
The International Public Sector Accounting Standards Board (IPSASB) has released Exposure Draft (ED) 84, Concessionary Leases and Right-of-Use Assets In-kind (Amendments to IPSAS 43 and IPSAS 23).
ED 84 is part of phase two of the IPSASB’s Leases project. It proposes amendments to IPSAS 43, Leases on accounting for concessionary leases, as well as new guidance on right-of-use assets in-kind and consequential amendments to IPSAS 23, Revenue from Non-Exchange Transactions (Taxes and Transfers).
Welcome to the sixth Market Scan from the IAASB's Disruptive Technology team. Building on our ongoing work, we issue a Market Scan every 2-3 months. Market Scans cover exciting trends, including new developments, corporate and start-up innovation, noteworthy investments and what it all might mean for the IAASB.
In this Market Scan, we explore Robotic Process Automation, a technology used for executing repetitive tasks that has applications across the audit process, from data transformation to workpaper creation, as well as potential for forming part of an audited entity’s IT environment.
Technology Landscape, September 2022
We cover:
What is Robotic Process Automation and why is it important?
The latest developments
What this might mean for the IAASB
What is Robotic Process Automation and why is it important?
Robotic Process Automation (RPA) is a technology that involves creating software robots or “bots” to perform repetitive, routine manual tasks, such as extracting data, filling out forms or moving files. By completing rules-based actions that emulate human processes, RPA tools can autonomously complete various activities across multiple unrelated software systems.
What is RPA (Robotic Process Automation)? Two-minute watch, Eye on Tech
What is RPA (Robotic Process Automation)? Two-minute min watch, Eye on Tech
RPA has evolved in recent years with companies such as Automation Anywhere, Blue Prism and UiPath developing ever more sophisticated technologies to automate tasks, workflows and processes. Coupling RPA with artificial intelligence technologies, such as machine learning, has enabled businesses to automate more complex tasks that may involve more judgment or use of unstructured data. This combination of technologies is often referred to as Intelligent Automation or Cognitive Automation.
RPA within the audit process
There are several areas across the audit where RPA can be deployed to drive efficiency in the audit process as well as improve audit quality by enabling consistency of outputs.
Data preparation – combining data sets (e.g., general ledger transactions and trial balance information) and carrying out transformation actions to prepare data for use in automated tools.
Transaction matching and reconciliation – automating the process of matching transactions to external datasets (e.g., bank statements)
Basic documentation – completion of basic standardized documentation, such as workpapers, checklists or templates based on prescribed inputs (e.g., trial balance information or information documented elsewhere in the audit file)
RPA within audited entities
Audited entities may use RPA to support certain business processes or repetitive task activities, such updating records, processing transactions or completing reconciliations.
Benefits of Robotic Process Automation, Digital Beanie
Recent Noteworthy Developments in Robotic Process Automation
These recent developments that may signal future disruption in this area. It is not a complete list of all activities in the field of RPA. For a reminder of Key Venture Capital and Investment terms please refer to the first Market Scan.
1. RPA market experiences slowing growth
The RPA market is dominated by some key players, with the 10 largest RPA vendors accounting for over 75% of the market. There have been some indications in the RPA market that growth in this technology sector may have begun to slow, although double digit growth is still predicted for 2023. UiPath, one of the leading companies in RPA software, has seen its stock value continue to fall since its IPO in 2021. Whilst Automation Anywhere, another well-known RPA provider, sought to secure a $200 million loan and Blue Prism, another large player, agreed to a $1.5 billion takeover offer from Vista Equity Partners in September 2022.
2. Startups with Low-Code and No-Code RPA Solutions
Whilst the traditional RPA industry may be slowing down, business process automation— a term used to describe the use of technologies, including RPA and AI, to streamline and automate more complex business processes—has seen continued growth, particularly with low-code or no-code solutions that can be deployed by those without coding skills.
In May 2022, UiPath announced a new partnership with airSlate, a workflow automation company, to advance the development of workflow solutions to enable individuals and small businesses to digitally transform their organizations.
In June 2022, Next Matter, a workflow automation platform for business operations, raised $16 million in a Series A funding round to expand its team and operations.
In November 2022, Rewst a no-code RPA provider for managed service providers, raised $21.5 million in Series A funding to continue to build out its Robotic Operations Center.
What this might mean for the IAASB
The IAASB is interested in maintaining its collective knowledgebase on digital technologies (including on specific sub-topics such as robotic process automation), promoting digital readiness and enablement through its engagement with stakeholders, and encouraging action by others to supplement and support the IAASB’s standard-setting activities.
The IAASB is also keen to explore how technologies could be used to enhance interaction with auditing standards. Subject to the IAASB’s work plan decisions, possible use cases of digital technologies for audited entities and audit engagements might provide input to further modernize the IAASB’s standards to be adaptable to and reflect the current business and audit environment (while recognizing that the standards would address digital technologies in a principles-based manner).
The increasing accessibility of RPA through the growth of low code and no code technologies offers opportunities for those without extensive programming knowledge to develop solutions to address specific pain points or low value time-consuming activities in their everyday work, including for audit practitioners or audited entities.
Where RPA or other robotics-based technologies are deployed by auditors to complete audit procedures, adequate governance and approval of these technologies needs to be in place to ensure they are designed effectively, fit for purpose and used appropriately, including provision of training or enablement where needed. Availability of no-code or low code technologies may give rise to wider use of small-scale RPA to address specific needs which has the potential to improve audit efficiency but if ungoverned, could impact audit quality.
The use of RPA in audited entities to automate actions previously performed by a person may change how a process and its related controls operate, and therefore the risks within the process and the appropriate audit response, which may include understanding how the use of RPA is being governed and controlled. As the use of this technology develops further, particularly when coupled with artificial intelligence technologies, this may present new challenges for the auditor and may, therefore, have implications for the IAASB’s work, whether in terms of future standard setting related to technology or facilitating or supporting action by others (e.g., developing guidance).
KFC, the popular fast-food chain, experienced a public relations disaster when its automated communications process messaged customers in Germany about a promotion to “commemorate Kristallnacht”. Kristallnacht was a series of Nazi pogroms that took place against German Jews in 1938. The company blamed an error in the automated process which linked calendar events to promotional content.
On January 1, 2023, the International Ethics Standards Board for Accountants (IESBA) welcomed two new members following their appointments by the Public Interest Oversight Board (PIOB) in November 2022.
Paul Muthaura (Kenya) is an independent consultant supporting the development of capital markets in emerging African jurisdictions. He is the Africa Chair for the Impact Infrastructure Commission; an Independent Member of the Financial Sector Deepening Trust, Kenya; and a Member of the Securities Advisory Board of the Toronto Centre for Global Leadership in Financial Supervision. A Lawyer and capital markets expert, his work experience includes risk management, standard setting, climate change, and sustainability. He is a former board member and Africa Middle East Regional Chair of the International Organization of Securities Commissions (IOSCO) and has led in a financial services group with operations across East Africa.
“It is an honor to be joining the IESBA at this important time,” said Mr. Muthaura. “I look forward to supporting the work to inject greater responsiveness, innovation, and impact in the IESBA Code and the broader reporting environment noting the global transition process.”
Rania Uwaydah Mardini(Lebanon) is a Senior Lecturer at the Olayan School of Business at the American University of Beirut (AUB) and an advisor to the United Nations Development Programme (UNDP's) Regional Bureau for Arab States. Prior to this appointment, she was a Member of the International Panel on Accountancy Education (IPAE) that advises the International Federation of Accountants (IFAC) and has served as [Board] Member of the International Accounting Education Standards Board (IAESB), the IPAE’s predecessor and Chair of its Public Sector Accounting, Reporting, and Assurance Task Force. She has also served as Vice Chairwoman of the Lebanese chapter of Transparency International (TI) and as a consultant to the UNDP’s Anti-Corruption and Integrity in the Arab Countries (ACIAC) program. She started her career in assurance at Ernst & Young (EY), Beirut office.
“We live in an increasingly complex environment where issues such as sustainability reporting and disruptive technologies present a wide range of unforeseen ethical dilemmas for accountants,” said Ms. Uwaydah Mardini. “Today,the IESBA’s role in providing the strong ethical guidance that drives accountants’ mindsets and judgements is ever so critical, and, as such, I look forward to the challenges and the learnings that this new position will bring!”
In addition to welcoming Mr. Muthaura and Ms.Uwaydah Mardini, the IESBA alsowelcomesthe appointment of Laurie Endsley as the Board’s new Vice Chair. Laurie C. Endsley joined as a Member of IESBA in January 2020, after being nominated by PwC. Ms. Endsley is a partner with PwC and has worked for more than 30 years as an auditor and attorney.
Ms. Endsley and current Board member Rich Huesken were both reappointed to the Boardby the PIOB, from January 1, 2023,for two-year terms.
“On behalf of the IESBA I am happy to welcome our new membersand Icongratulate Laurieand Rich on their reappointments,” said IESBA Chair Gabriela Figueiredo Dias. “Paul and Rania come to our Board at a critical time, and I look forward to their diverse and unique insights. Their experiences and perspectiveswilladd to the IESBA’s knowledge baseand help guide our strategic thinking. I also look forward to partnering with Laurie, as Vice Chair, to help lead the IESBA as we tackle an aggressive schedule.”
The PIOB’s Invitation for Applicationfor IESBA members for terms of service beginning in January 2024 is currently open. The IESBA encourages qualified candidates to apply.
New Members Began their Terms of Service January 1, 2023
The International Auditing and Assurance Standards Board (IAASB) is pleased to welcome two new members to the IAASB following their appointments by the Public Interest Oversight Board (PIOB) in November 2022.
Neil Morris (based in the UK) is the global head of assurance and ESG methodology at KPMG with more than two decades of experience in South Africa and the UK. A Chartered Accountant, his work experience includes risk management, climate change and sustainability, financial audit, and assurance.
“I’m looking forward to the challenge that this role will bring and working with my fellow members to deliver on the IAASB’s objectives, especially on the sustainability assurance standard,” Mr. Morris noted on joining the IAASB.
Greg Schollum (based in New Zealand) is the Deputy Controller and Auditor-General of New Zealand, a position he has held since 2015 after first joining the Office of the Auditor-General in 2004. His career includes serving as a member of the International Public Sector Accounting Standards Board, the New Zealand Accounting Standards Board, and the Financial Reporting Standards Board of the New Zealand Institute of Chartered Accountants (now Chartered Accountants Australia & New Zealand).
“I’m looking forward to getting back involved in international standard setting and I hope that I can make a positive contribution in the public interest to the important work of the IAASB,” Mr. Schollum said following his appointment.
In addition to welcoming Mr. Morris and Mr. Schollum, the IAASB also welcomes the appointment of Josephine Jackson as Vice-Chair. Ms. Jackson is Director of International Audit and Assurance Standards Policy at the UK Financial Reporting Council and leads the FRC’s ESG Group. She is entering her second term as member of the IAASB and previously served as a board member Technical Advisor.
“I am delighted to welcome our new IAASB members and congratulate Josephine on behalf of the IAASB,” said IAASB Chair Tom Seidenstein. “Greg and Neil bring new experience and perspectives to the IAASB, and we look forward to including their thinking in deliberations at our next IAASB meeting in March. I also look forward to partnering with Josephine to help guide the IAASB through its important work in the public interest.”
The IAASB is also pleased to share that three members were re-appointed by the PIOB for terms that began on January 1, 2023:
Sue Almond, a consultant with Grant Thornton International based in the UK with experience in global audit and assurance policies;
Julie Corden, a partner with Deloitte Canada who is responsible for leading audit methodology, policies and guidance, including the firm's ISQM 1 implementation; and
Josephine Jackson, the newly appointed Vice-Chair.
The PIOB’s Invitation for Application for IAASB members for terms of service beginning in January 2024 is currently open. The IAASB encourages qualified candidates to apply.
About the IAASB The International Auditing and Assurance Standards Board 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 the International Federation of Accountants (IFAC). For copyright, trademark, and permissions information, please go to permissions or contact permissions@ifac.org.
New Members Began their Terms of Service January 1, 2023
