At its meeting on September 12-16, 2022, the IAASB discussed the LCE Task Force’s proposals on four matters relevant to the proposed ISA for Audits of Financial Statements of Less Complex Entities (ISA for LCE) — the Authority of the proposed standard, the approach to accounting estimates, the incorporation of audits of group financial statements (group audits) and the approach to drafting requirements proportionate to an LCE. The Board generally supported the LCE Task Force’s proposed changes to the draft Authority of the proposed ISA for LCE including the use of language reflecting the expectation for legislative or regulatory authorities or relevant local bodies with standard setting authority to determine quantitative thresholds for their jurisdiction. The Board also agreed to explain how quantitative indicators were considered during the development of the proposed standard. The Board supported the LCE Task Force’s proposals regarding accounting estimates, the changes to the draft Authority to incorporate considerations relating to audits of group audits and the approach to the drafting of Part 10, Audits of Group Financial Statements. On balance, the Board also supported the direction of excluding group audits involving the use of component auditors from the scope of the proposed ISA for LCE. With respect to the approach to developing proportionate requirements for audits of LCEs, the Board discussed and provided further directions to the LCE Task Force. The LCE Task Force will continue to analyze responses to the Exposure Draft of the proposed ISA for LCE and continue developing revised drafting in priority areas. In December 2022, the LCE Task Force plans to bring to the Board for discussion a full draft of Part 10, Audits of Group Financial Statements.

Review the summary, including the podcast, on the IAASB's Web site.