Revisions to ISA 315 - IAASB

Date recorded:

At its meeting on March 12-16, 2018, the IAASB discussed the proposed changes to the requirements and application material in draft proposed ISA 315 (Revised). The Board continued to broadly support the direction of the proposals, but noted further clarity was needed in a number of areas, in particular relating to some aspects of the definitions and the requirements for the identification and assessment of the risks of material misstatement.

The Board requested that the ISA 315 Task Force reassess whether the identification of risks of material misstatement related to fraud could be made more prominent in the standard, in particular as it relates to the inherent risk factors and the proposal to broaden these risk factors to include matter related to both intentional and unintentional misstatements.

There was general support for the new introductory paragraphs however, these were seen to be complex, introduced terms too early in the standard and in some cases were not consistent with the wording in the relevant other standards.

The Board decided that further clarification and guidance was needed in relation to general IT controls, while also supporting the ISA 315 Task Force’s suggested guidance in relation to IT and the use of data analytics (subject to further consideration about the term to be used to mean ‘data analytics’). The Board also agreed that more needed to be done to address scalability. Aspects of draft ISA 315 (Revised) will be discussed at an IAASB teleconference on May 22, 2018, and the ISA 315 Task Force will continue to progress the proposed changes to the proposed standard for approval as an exposure draft at the June 2017 IAASB meeting.

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