At its meeting on February 25-26, 2021, the AASB Chair Ken Charbonneau advised the AASOC that, based on the AASB’s outreach activities, practitioners experience challenges in applying the Canadian Auditing Standards (CASs) when auditing LCEs. This is also a significant international issue. However, the international project focuses on a separate standard and the Board believes that this approach has fundamental public interest issues. So, the Board asked its Audits of Less Complex Entities Advisory Group (the Advisory Group) to consider domestic actions that may be taken to address the challenges practitioners face in auditing LCEs. First, the Advisory Group considered then-extant CAS 315, Identifying and Assessing the Risks of Material Misstatement Through Understanding the Entity and Its Environment, that stakeholders found challenging to apply in audits of LCEs. Following the Advisory Group’s assessment, the Board concluded at its February 2021 meeting that these matters will be addressed appropriately in newly revised CAS 315, Identifying and Assessing the Risks of material Misstatement, and related non-authoritative guidance.

At its meeting on February 25-26, 2021, the AASOC considered whether the AASB followed due process with proper regard for the public interest in developing and approving Canadian Standards on Quality Management (CSQM 1, Quality Management for Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or Related Services Engagements, CSQM 2, Engagement Quality Reviews, CAS 220, Quality Management for an Audit of Financial Statements, and related conforming amendments). After discussing the project, the AASOC concluded that the AASB had followed due process with proper regard for the public interest in developing and approving the Canadian Standards on Quality Management.