News

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IESBA Q&A Update: Clarifying PIE Definition for Global Compliance

Sep 03, 2024

On September 3, 2024, the International Ethics Standards Board for Accountants (IESBA) released an update to its Questions and Answers (Q&As) publication, originally published in March 2023, on the IESBA revisions to the definitions of listed entity and public interest entity (PIE) in the IESBA Code of Ethics (Code).

This update includes a new Q&A to address the scenario where a jurisdiction has no PIE definition or excludes one or more of the mandatory categories in the IESBA PIE definition.

The Q&A publication is designed to highlight, illustrate, or explain aspects of the PIE revisions in the Code and is intended to complement the Basis for Conclusions for the final pronouncement. It aims to assist national standards setters, professional accountancy organizations, and firms in adopting and/or implementing the PIE revisions.

The PIE revisions are effective for audits of financial statements for periods beginning on or after December 15, 2024.

Access the press release and the Q&A document on the IESBA’s website.

 

PCAOB (US Public Company Accounting Oversight Board) (dark gray) Image

Audit Committee and Auditor Oversight Update No. 93

Aug 28, 2024

On August 28, 2024, Dan Goelzer, former PCAOB chair, released the Audit Committee and Auditor Oversight Update No. 93 for August 2024. This Update summarizes recent developments relating to public company audit committees, their oversight of financial reporting, and the company’s relationship with its auditor.

The update covers several key topics, including the 2023 PCAOB Large Firm Inspection Reports and the PCAOB staff's explanation of these inspection results. It highlights a significant court decision rejecting the SEC's use of internal control authority to police cybersecurity. Additionally, Mr. Goelzer reviews the resource on generative artificial intelligence (AI) oversight by the audit committees released by the CAQ, and the focus by the PCAOB on the role of generative AI in auditing.

Access the update on Dan Goelzer’s website.

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IVSC concludes perspectives paper series on intangible assets

Aug 27, 2024

On August 27, 2024, the International Valuation Standards Council (IVSC) released its concluding perspective paper, marking the end of the series. This final publication focuses on the lessons learned throughout the series.

This conclusive paper brings together the insights and findings from the entire series, offering a comprehensive view of the valuation of intangible assets, which have become increasingly pivotal in today’s global economy.

 The series on perspectives papers is now as follows:

  • The Case for Realigning Reporting Standards with Modern Value Creation (September 2021)
  • Human Capital Introspective (May 2022)
  • Rethinking Brand Value (September 2022)
  • Deciphering Technology (July 2023)
  • Data and Valuation (March 2024)
  • Inspection of Tangible Assets (June 2024)
  • Making Intangible Assets More Tangible: Series Lessons (August 2024)

Access the press release on the IVSC’s website.

 

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ThinkTwenty20 releases August 2024 Newsletter

Aug 20, 2024

On August 20, 2024, ThinkTwenty20 released its latest August 2024 issue, featuring Eric Cohen's column "Twenty Rules for AI for Financial Professionals," which offers risk-related guidelines for AI use in finance, emphasizing confidentiality, skepticism, diversification, compliance, and transparency amidst the rapid evolution of generative AI like ChatGPT.

Mr. Cohen, a consultant on emerging accounting and audit technologies, highlights the rapid evolution of generative AI, like ChatGPT, and its integration into business tools, underscoring the need for financial professionals to be cautious and informed. Key points include not sharing sensitive information with AI, verifying AI outputs, using multiple AI tools to avoid over-reliance on one, ensuring compliance with regulations, and being transparent about AI usage. Mr. Cohen also discusses the historical context of AI, the importance of staying updated with AI advancements, and the challenges of integrating AI into existing workflows. The guidance aims to help financial professionals navigate the complexities and risks associated with AI, promoting a balanced and informed approach to its adoption and use.

Access the newsletter on ThinkTwenty20’s website.

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CSA Updates on Continuous Disclosure Obligations and Prospectus Filings for Non-investment Fund Reporting Issuers

Aug 12, 2024

On August 12, 2024, Blakes, a law firm in Canada, provided updates on various outstanding initiatives undertaken by the Canadian Securities Administrators (CSA) concerning continuous disclosure obligations and prospectus filings for non-investment fund reporting issuers.

Key development updates described in the CSA’s 2023-2024 Year in Review Report (Annual Report) included the CSA’s intention to publish a revised proposal on climate-related disclosure requirements, aligning with the final Canadian sustainability disclosure standards. Additionally, the CSA has proposed amendments to the “comply or explain” diversity disclosure regime for boards of directors and executive officers, with final amendments expected soon. The CSA has also implemented an “access equals delivery” model for prospectuses and is considering feedback on extending this model to continuous disclosure documents. Furthermore, the CSA plans to streamline annual and interim disclosure requirements and has proposed a permanent expedited shelf prospectus regime for well-known seasoned issuers (WKSIs).

Other notable updates include the CSA’s review of transaction rules, with proposed amendments and updated guidance forthcoming. The CSA also prepares targeted amendments to enhance the early warning reporting regime. Additionally, amendments to the Canada Business Corporations Act now allow shareholders to vote “for” or “against” director nominees in uncontested elections, and the CSA has proposed codifying exemptions from the requirement to include a “withhold” option on proxy forms. As the CSA modernizes its regulatory framework to reduce burdens while enhancing investor protection, Blakes will monitor and update on significant legal developments affecting continuous disclosure obligations and prospectus filings.

Access the article on Blakes’ website.

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Overview of the Canadian Legal Framework Relative to Artificial Intelligence Systems Following the Adoption of the AI Act in Europe

Aug 09, 2024

On August 9, 2024, McMillan, a law firm in Canada, published an article discussing the integration of artificial intelligence (AI) in daily life, the European Union’s AI Act, and the evolving Canadian legal framework. The article emphasizes the need for organizations to navigate these regulations to ensure a compliant and responsible AI deployment.

McMillan's article explores AI's pervasive role in everyday activities and the regulatory frameworks emerging to govern its use. It highlights the European Union's AI Act, which came into force on August 1, 2024, establishing stringent rules and obligations for AI systems, particularly those deemed high-risk.

The article contrasts this with Canada's current patchwork of federal and provincial laws, noting the absence of comprehensive AI-specific legislation akin to the AI Act. However, it mentions Bill C-27, which aims to introduce the Artificial Intelligence and Data Act (AIDA) to provide a structured legal framework for AI in Canada. The article underscores the importance of organizations staying informed and compliant with these evolving regulations to ensure AI technologies' responsible and ethical deployment.

Access the article on McMillan’s website.

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SEC Filing Statuses and Compliance Requirements for Foreign Private Issuers

Aug 07, 2024

On August 7, 2024, Troutman Pepper, a legal firm in the US, issued an alert detailing the various filing statuses and compliance requirements for foreign private issuers. The alert stressed the need for an annual assessment to determine applicable SEC requirements.

Foreign private issuers registered with the SEC must navigate various filing statuses impacting public disclosures. These issuers need to assess their status to determine applicable SEC requirements annually. The alert outlines the benefits of being classified as a Foreign Private Issuer (FPI), such as significant disclosure accommodations, and the criteria for qualifying as an Emerging Growth Company (EGC), which offers scaled disclosure accommodations.

It also details the process for determining SEC accelerated filing status based on public float and the implications of such statuses on reporting obligations. Additionally, Canadian issuers can leverage the multijurisdictional disclosure system (MJDS) for streamlined reporting using Canadian standards. Lastly, the alert discusses the impact of having substantial U.S. market interest (SUSMI) on securities offerings outside the U.S. under Regulation S.

Access more details on the Troutman Pepper’s website.

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Canadian securities regulators propose targeted changes to certain rules and policies

Aug 01, 2024

On August 1, 2024, the Canadian Securities Administrators (CSA) published a Notice and Request for Comment on proposed amendments and changes to certain National Instruments and Policies to address several matters, including creating a Senior Tier by the Canadian Securities Exchange (CSE).

The new Senior Tier of the CSE targets non-venture issuers and aligns with non-venture exchange requirements. Proposed amendments redefine "venture issuer" to exclude CSE’s Senior Tier companies, allowing them to be treated similarly to issuers on other non-venture exchanges under securities legislation.

The CSA Notice and Request for Comment also includes proposed amendments and changes on the following other matters:

  • Aligning certain exemptions and eligibility requirements so that they apply to the CSE in the same manner as they do for other similar exchanges
  • Codifying blanket orders issued by CSA members to accommodate recent “majority voting” amendments to the Canada Business Corporations Act
  • Reflecting the name change of the former Aequitas NEO Exchange Inc. to
    Cboe Canada Inc.
  • Reflecting the name change of the former PLUS markets to AQSE Growth Market and
  • Removing the requirement for escrow agreements to be signed, sealed and delivered by security holders in the presence of a witness.

The 90-day comment period closes on October 30, 2024.

Access the press release on CSA’s website.

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IASB issues podcast on latest Board developments (July 2024)

Aug 01, 2024

On August 1, 2024, the International Accounting Standards Board (IASB) released a podcast hosted by the Executive Technical Director Nili Shah featuring IASB Vice-Chair Linda Mezon-Hutter and IASB Member Tadeu Cendon discussing the deliberations held during the July 2024 IASB meeting.

The podcast highlights some of the projects that were discussed during the meeting, including:

  • Post-implementation review of IFRS 15 Revenue from Contracts with Customers
  • Rate-regulated activities
  • Second comprehensive review of the IFRS for SMEs Accounting Standard

The podcast can be accessed here on the IFRS Foundation website

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ThinkTwenty20 releases July 2024 Newsletter

Jul 31, 2024

On July 31, 2024, ThinkTwenty20 released its latest July 2024 issue, featuring discussions related to cyber threats, digital signatures, blockchain in payments, audit committees, productivity, and actionable sustainability strategies.

The July 2024 issue of ThinkTWENTY20 features insightful discussions on various critical topics. It addresses the growing threat of cyberattacks and the multidisciplinary approach needed to combat them. The issue also explores the importance of digital signatures in ensuring trust and integrity in corporate reporting. A three-part series on international clearing and settlement delves into the complexities of legacy payment systems and the potential of blockchain technology. Additionally, the crucial role of audit committees in overseeing internal audit functions is examined, offering best practices for success. The issue features a book review on achieving productivity without burnout and highlights a new book on converting sustainability disclosures into actionable corporate strategies. This comprehensive edition provides valuable perspectives on enhancing security, trust, efficiency, and sustainability in today's corporate landscape.

Access the newsletter on ThinkTwenty20’s website.

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