Audits of Less Complex Entities – AASB

Date recorded:

At its meeting on June 6-7, 2022, the AASB discussed issues related to the IAASB’s project to develop a standard for audits of less complex entities (LCEs). Key issues discussed included: the Authority of the standard, including: (i) whether the IAASB should describe what an LCE is, rather than setting out characteristics of entities that would not use the standard; (ii) whether the IAASB should require or encourage jurisdictions to establish quantitative thresholds (i.e., size tests to determine if an entity is an LCE); (iii) how requirements in the draft LCE standard could be rewritten to be more principles-based, and whether such changes would result in increased efficiencies in an LCE audit; (iv) the IAASB’s approach to including essential explanatory material in the LCE standard; and (v) whether the IAASB has addressed the significant concerns and barriers to having a separate standard that provides reasonable assurance that several respondents to the IAASB’s Exposure Draft raised. The AASB also discussed next steps in Canada, including additional research on Canadian issues that staff proposes to undertake.

Review the Executive Summary on the AASB's Web site.

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.