The video series includes the following:

• Overview of Key Changes: Gain an understanding of the critical changes proposed by IAASB Member and Fraud Task Force Chair Julie Corden, a partner with Deloitte Canada. Julie also provides brief background information on why these changes are being proposed.
• Spotlight on Auditor’s Responsibilities: Understand auditors’ responsibilities relating to fraud in an audit. IAASB Senior Manager Nathalie Baumgaertener Dutang explains how the proposed changes make these responsibilities more transparent and practical.
• Auditor’s Response to Fraud or Suspected Fraud: How are auditors and engagement partners being asked to enhance how they respond to fraud or suspected fraud? IAASB Principal Angelo Giardina outlines the new requirements, relocated requirements, and clarifications.
• Enhanced Transparency in the Auditor’s Report: Join IAASB Director Jasper van den Hout to learn more about how the proposed changes will improve transparency in the auditor’s report regarding auditors’ responsibilities relating to fraud as well as fraud-related procedures (i.e., Key Audit Matters related to fraud).

The revisions to ISA 240 represent a substantial enhancement of auditors’ duties concerning fraud. The IAASB urges all stakeholders to provide feedback using the Response Template, which aims to enable organized responses and simplify the collection and analysis of feedback. Stakeholders are welcome to contribute their perspectives by June 5, 2024.

Access the exposure draft on revisions to ISA 240 on the IAASB’s website.

Inspection results are mixed with inconsistency across all categories of firms. While there was an improvement in the aggregate findings rates at the non-annually inspected firms, the level of findings at many firms remains unacceptably high. CPAB continues to see a strong association between audit quality and robust systems of quality management.

In 2023, CPAB initiated the public release of notable enforcement measures from inspection findings. Additionally, CPAB conducted a public follow-up discussion on regulatory modifications concerning the compulsory sharing of inspection reports with audit committees and the publication of individual firm inspection reports. CPAB anticipates that these adjustments will positively influence audit quality in Canada by offering enhanced transparency to the public regarding our inspection outcomes and the activities of audit firms overseeing Canadian reporting issuers.

Access the 2023 Annual Report on CPAB’s website

The Independent Review Committee on Standard Setting in Canada recommended that an effectiveness review be conducted with the assistance of an independent third party to help streamline and harmonize oversight activities and processes. In response to the results, the Effectiveness Review Joint Taskforce and the current oversight councils approved that a single council be created to oversee standard setting for accounting, audit and assurance, and sustainability.  

This decision consolidates the activities of three oversight bodies – the Auditing and Assurance Standards Oversight Council (AASOC), Accounting Standards Oversight Council (AcSOC), and the Canadian Sustainability Standards Board (CSSB) Implementation Committee – streamlining the processes and activities for accounting, audit, assurance, and sustainability standard setting.

The Oversight Council is effective from April 1, 2024, and will focus its initial work on establishing its operations and governance processes. It will begin its formal oversight work on July 1, 2024. The current oversight bodies will conclude their operations on June 30, 2024.

Access the press release on the FRASCanada website.

The 2022-2025 Strategic Plan outlines five strategic goals and supporting objectives while the Annual Plan includes specific activities that will support the achievement of these objectives.

The strategic goals for 2022 – 2025 are as follows:

• Monitor and understand emerging issues in the changing environment to better anticipate standard setting needs.
• Engage and collaborate with interested and affected parties to understand their needs and expectations.
• Set high-quality standards and guidance that respond to the evolving needs and expectations of interested and affected parties.
• Enhance our standard-setting processes and capabilities to develop timelier solutions.
• Support the effective implementation and application of standards and guidance to enhance consistency and quality in engagement performance.

Access the annual plan on the AASB’s website.

Canadian Auditing Standard 315, Identifying and Assessing the Risks of Material Misstatement (CAS 315), was revised effective for 2022 calendar year-ends to better align with the increasing complexity of business models and the use of technology while emphasizing an iterative and dynamic approach to risk assessment.

While CPAB has observed improvements to auditors' risk assessment procedures, it believes that more remains to be done. CPAB identified findings related to implementing the revised standards across a range of audit areas, including revenue, business combinations, financial instruments, and inventory.

This CPAB’s communication is intended to highlight the importance of understanding the entity. It also provides insights into the significant findings identified through illustrative scenarios and shares good practices observed in files with no findings. CPAB expects audit firm leadership to develop targeted actions to improve the quality of auditor’s identification and assessment of risks. It also emphasizes the importance of holding management accountable for fulfilling the responsibilities, effective two-way communication with the audit committee and the importance of robust risk identification and assessment to audit quality.

Access the report on the CPAB’s website.

The high-level summary is designed to highlight non-assurance services, relationships, interests or circumstances that are prohibited for PIE audits. It will be a valuable reference to stakeholders, including regulators and audit oversight bodies, audit firms and individual audit practitioners, the corporate governance community, investors, preparers, and educational bodies or institutions.

The high-level summary is not a substitute for reading the Code.

Access the press release and the summary on the IESBA’s website.

As per its statement, the CAQ believes that the recent roundtable conducted by the Public Company Accounting Oversight Board (PCAOB) regarding its proposal on company noncompliance with laws and regulations (NOCLAR) fell short of the principles of transparency and accountability essential for effective public policy development.

“Today’s NOCLAR roundtable was a missed opportunity for the PCAOB to further understand the views highlighted in numerous comment letters from engaged stakeholders,” said Julie Bell Lindsay, Chief Executive Officer, CAQ. “Not only did the roundtable surface disagreement as to the actual scope or intention of the proposal, but we are concerned that the lack of diverse stakeholder representation – particularly from investors and audit committees, two important audiences – resulted in dialogue that did not meaningfully address stakeholder concerns. Given the discussion at the roundtable, we believe that the appropriate response is to re-propose the standard, with an economic analysis, to begin to address these concerns.” 

Access the statement on the CAQ website and the roundtable on the PCAOB’s website.

This move comes in response to the critical role high-quality audits play in ensuring the smooth functioning of capital markets. Recent international corporate failures and significant accounting restatements have heightened scrutiny on all participants in the financial reporting system, emphasizing the importance of confidence in audits. As fraud remains a focal point, the IAASB seeks to strengthen auditor duties concerning fraud detection and prevention to better serve the public interest and bolster trust in financial reporting.

The changes will:

• clarify the auditor’s responsibilities about fraud in financial statement audits;
• strengthen the auditor’s procedures; and 
• include more detail about fraud in the auditor’s report. 

The proposed revisions are expected to significantly strengthen the IAASB’s standard on auditors’ responsibilities related to fraud by defining the expectations in relation to fraud, delineating more robust procedures, and increasing transparency about the auditors’ responsibilities and fraud-related procedures in the auditor’s report.

Access the explanatory memo on the IASSB’s website.

The proposed revisions define the expectations in relation to fraud, delineate more robust procedures, and increase transparency about the auditors’ responsibilities and fraud-related procedures in the auditor’s report.

Key Changes in the Proposed Revisions include:

• Clarified auditor responsibilities relating to fraud in an audit.
• Emphasized professional skepticism to ensure auditors remain alert to possible fraud and exercise professional skepticism throughout an audit.
• Strengthened identification and assessment of risks of material misstatement due to fraud.
• Clarified response to fraud or suspected fraud identified during the audit.
• Increased ongoing communication with management and those charged with governance about fraud.
• Increased transparency about auditors’ responsibilities and fraud-related procedures in the auditor’s report.
• Enhanced audit documentation requirements about fraud-related procedures.

Respondents are encouraged to share their insights using the response template by June 5, 2024.

Access the exposure draft and response template on IAASB’s website.

The proposed revisions define the expectations in relation to fraud, delineate more robust procedures, and increase transparency about the auditors’ responsibilities and fraud-related procedures in the auditor’s report.

Key Changes in the Proposed Revisions include:

• Clarified auditor responsibilities relating to fraud in an audit.
• Emphasized professional skepticism to ensure auditors remain alert to possible fraud and exercise professional skepticism throughout an audit.
• Strengthened identification and assessment of risks of material misstatement due to fraud.
• Clarified response to fraud or suspected fraud identified during the audit.
• Increased ongoing communication with management and those charged with governance about fraud.
• Increased transparency about auditors’ responsibilities and fraud-related procedures in the auditor’s report.
• Enhanced audit documentation requirements about fraud-related procedures.

Respondents are encouraged to share their insights using the response template by June 5, 2024.

Access the exposure draft and response template on IAASB’s website.