Related Discussions

• Going Concern - IAASB

• Sep 12, 2022

• At its meeting on September 12-16, 2022, the IAASB discussed the Going Concern Task Force’s initial views and recommendations for selected key issues identified in the project proposal for the revision of ISA 570 (Revised). In addition, the Board broadly supported the changes considered and made to the drafting paragraphs of ISA 570 (Revised) in response to Board feedback for the topics that were deliberated at the June 2022 IAASB meeting. The Board supported the proposed definition for material uncertainty (related to going concern) and the enhancements proposed to enable a more robust exercise of professional skepticism when performing procedures related to going concern. There was also support for the proposed enhancements to strengthen the requirements of proposed ISA 570 (Revised) to drive the auditor to obtain information that is relevant to timely identification of events and conditions that may cast significant doubt on the entity’s ability to continue as a going concern and to require a more robust evaluation of management’s assessment of going concern. Other matters that were discussed by the Board, and for which directional support was provided to the Going Concern Task Force, included the timeline over which the going concern assessment is made and transparency about going concern in the auditor’s report. In December 2022, the Going Concern Task Force intends to discuss with the Board the remaining proposed actions in the project proposal and the conforming and consequential amendments to other relevant ISAs as a result of the proposed revisions to ISA 570 (Revised). In addition, the Board will be presented with a first full draft of proposed ISA 570 (Revised).

• Fraud - IAASB

• Sep 12, 2022

• At its meeting on September 12-16, 2022, the IAASB discussed, and was supportive of, the Fraud Task Force’s drafting with respect to the sections in proposed ISA 240 (Revised) that refer to, or expand on, ISA 315 (Revised 2019). The Board also discussed the Task Force’s proposals in relation to transparency in the auditor’s report and provided feedback on the way forward. The Board generally agreed to have more transparency about fraud in the auditor’s report. The Board: (i) agreed that the auditor’s communications on fraud should be included in a separate section in the auditor’s report; (ii) generally agreed that the auditor’s responsibilities as they relate to fraud in the audit of the financial statements should be enhanced in the auditor’s report; (iii) had mixed views on whether the identified and assessed fraud risks and the auditor’s response to the assessed risks should be communicated in the auditor’s report. The Board asked the Fraud Task Force to explore a mechanism similar to key audit matters and including a ‘filter’ to only communicate the most significant fraud risks; (iv) had mixed views on including the identified significant deficiencies in internal control that are relevant to the prevention and detection of fraud in the financial statements in the auditor’s report. The Board asked the Fraud Task Force to further explore this communication by taking into account the views of users of the financial statements and the concerns the Board raised; and (v) agreed that the proposed changes to the auditor’ report should only apply to listed entities or Public Interest Entities. In December 2022, the Fraud Task Force will bring drafting for various topics to the Board for further deliberation.

• Going Concern – AASB

• Sep 08, 2022

• At its meeting on September 8-9, 2022, the AASB discussed issues related to the IAASB’s project to revise ISA 570 (Revised), Going Concern. Key issues included: terminology; risk identification and assessment; management’s assessment of going concern; professional skepticism; and transparency about going concern in the auditor’s report.

• Fraud – AASB

• Sep 08, 2022

• At its meeting on September 8-9, 2022, the AASB discussed issues related to the IAASB’s project to revise ISA 240, The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements. Key issues included: options for adding further transparency in the auditor’s report regarding fraud; whether the proposed changes should apply to listed entities or all entities; and the proposed structure for ISA 240.

• Fraud - IAASB

• Jun 13, 2022

• At its meeting on June 13-17, 2022, the IAASB discussed and broadly supported the changes in proposed ISA 240 (Revised) to emphasize the auditor’s responsibilities relating to fraud in an audit of financial statements and reduce the ambiguity between the inherent limitations of an audit and the auditor’s responsibilities for fraud. The Fraud Task Force will conduct outreach with users of financial statements in Q2/Q3 2022 relating to transparency in the auditor’s report and report back to the Board in September 2022. In December 2022, the Fraud Task Force will bring other additional topics as outlined in the project proposal for the Board to deliberate, in addition to advancing the areas previously discussed by the Board.

• Going Concern - IAASB

• Jun 13, 2022

• At its meeting on June 13-17, 2022, the IAASB discussed and broadly supported the Going Concern Task Force’s initial views and recommendations for selected key issues identified in the project proposal for the revision of ISA 570 (Revised). This included proposals for the timeline over which the going concern assessment is made and for transparency about the auditor’s responsibilities and work related to going concern. In September 2022, the Going Concern Task Force intends to discuss with the Board certain other proposed actions in the project proposal such as risk identification and assessment, terminology, management’s assessment of going concern, and professional skepticism.

• Going Concern - AASB

• Jun 06, 2022

• At its meeting on June 6-7, 2022, the AASB discussed issues related to the IAASB’s project to revise ISA 570. Key issues discussed included: (i) the timeline over which the going concern assessment is made; and (ii) transparency about going concern in the auditor’s report.

• Fraud – AASB

• Jun 06, 2022

• At its meeting on June 6-7, 2022, the AASB discussed issues related to the IAASB’s project to revise ISA 240. Key issues discussed included: (i) the introductory paragraphs of the standard; the need for specialized skills; (ii) identifying and assessing the risks of material misstatement due to fraud; (iii) the presumption of fraud risk in revenue recognition; (iv) clarifying the requirements and application material in ISA 240 related to the approach to testing journal entries; and (v) communicating with those charged with governance.

• Going Concern – IAASB

• Mar 14, 2022

• At its meeting on March 14-18 and 23, 2022, the IAASB discussed and approved a project proposal for the revision of ISA 570 (Revised) and the conforming and consequential amendments to other relevant ISAs. The project will primarily be focused on standard-setting actions that are intended to address targeted revisions of ISA 570 (Revised), rather than a comprehensive revision of the standard. Specifically, the project will seek to enhance or clarify: (i) the auditor’s responsibilities and work related to management’s assessment of an entity’s ability to continue as a going concern in the audit of financial statements; and (ii) transparency about the auditor’s responsibilities and work related to going concern. The Going Concern Task Force intends to discuss and bring to the Board for their input at the June 2022 IAASB meeting certain proposed actions included in the scope of the project proposal.

• Fraud – IAASB

• Mar 14, 2022

• At its meeting on March 14-18 and 23, 2022, the IAASB discussed and broadly agreed with the Fraud Task Force’s proposals on proposed changes in ISA 240 addressing the identification and assessment of the risks of material misstatement due to fraud and communication with those charged with governance about fraud-related matters. The Board also discussed different alternatives on the way forward for transparency in reporting on fraud and agreed that all alternatives presented should be included in the planned outreach with users of financial statements. The Board was broadly supportive of the non-authoritative guidance illustrating the relationship between and linkage of ISA 240 and other ISAs. The Fraud Task Force will finalize the guidance for publication in Q2/2022. In June 2022, the Fraud Task Force will bring to the Board for discussion the topics highlighted in the March 2022 IAASB meeting as well as selected new topics (i.e., introduction section, definitions, the requirements related to journal entries, specialized skills and the presumption of fraud risk in revenue recognition, and the related application and other explanatory material), including drafting proposals for certain of these topics.

• Going Concern – AASB

• Mar 07, 2022

• At its meeting on March 7-8, 2022, the AASB provided input to the IAASB members from Canada on issues related to the IAASB’s project to revise ISA 570 (Revised). Key issues discussed included: (i) the time period for assessing going concern; (ii) enhancing transparency regarding the auditor’s work on going concern; and (iii) the exposure period.

• Fraud – AASB

• Mar 07, 2022

• At its meeting on March 7-8, 2022, the AASB provided input to the IAASB members from Canada on issues related to the IAASB’s project to revise ISA 240. Key issues discussed included: (i) identifying and assessing risks of material misstatement due to fraud; (ii) communication with those charged with governance; (iii) transparency in reporting on fraud; and (iv) developing non-authoritative guidance illustrating the relationship between and linkage of ISA 240 and other ISAs.

• Fraud – IAASB

• Dec 06, 2021

• At its meeting on December 6-14, 2021, the IAASB discussed and approved a project proposal for the revision of ISA 240 and the conforming and consequential amendments to other relevant ISAs. In the project proposal, the IAASB recognized the importance of the role of its standards in the financial reporting ecosystem. Therefore, the project will be focused on specific standard-setting actions aimed at enabling consistent and improved auditor behavior. Specifically, the project will seek to clarify the auditor’s responsibilities and enhance the robustness of the required auditor’s procedures and reporting on fraud in an audit of financial statements. The Fraud Task Force intends to discuss and bring to the Board for their input at the March 2022 IAASB meeting specific proposed actions included in the scope of the project on fraud addressing key issues identified regarding the role and responsibilities of the auditor, risk identification and assessment, and transparency.

• Fraud – AASB

• Nov 29, 2021

• At its meeting on November 29-30, 2021, the AASB provided input to the IAASB members from Canada on the IAASB Working Group’s project proposal to revise ISA 240. Key issues discussed included: (i) strengthening the auditor’s responses to assessed risks of a material misstatement due to fraud; (ii) clarifying the approach to journal-entry testing when considering fraud; (iii) clarifying how performing a robust risk assessment is critical in determining whether the rebuttable presumption of fraud risk in revenue recognition is applicable; and (iv) enhancing the application material in ISA 240 related to fraud considerations for external confirmation procedures. The AASB also discussed the Canadian approach to the Fraud and Going Concern projects.

• Fraud – IAASB

• Sep 13, 2021

• At its meeting on September 13-21, 2021, in recognition that the fraud project proposal requires careful scoping and would benefit from a few iterations to finalize for Board consideration, the IAASB leadership took the decision to move the approval of the project proposal for fraud to the December 2021 IAASB meeting (previously planned for September). The Board believes this additional investment in time and effort will assist in getting the key public interest objective right. It will also ensure that the project proposal fairly reflects what was heard from respondents, the Fraud Working Group’s deliberations, feedback from the Board and further outreach undertaken.

• Fraud – AASB

• Jul 15, 2021

• At its meeting on July 15, 2021, the AASB provided input to the IAASB members from Canada on issues related to information gathered on ISA 240, The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements. Key issues discussed included: (i) whether further transparency is needed related to fraud in the auditor’s report; (ii) enhanced engagement team discussions on fraud considerations; and (iii) clarifying the relationship between ISA 240 and ISA 250, Consideration of Laws and Regulations in an Audit of Financial Statements, by developing new application material.

• Fraud and Going Concern – IAASB

• Jun 14, 2021

• At its meeting on June 14-23, 2021, the IAASB’s Fraud Working Group presented possible actions forward for six specific topics raised by respondents to the Discussion Paper where mixed responses were received or where emerging issues have been observed in the current environment. The Board provided comments for the Fraud Working Group to consider as it develops a project proposal and, if the project proposal is approved, as it further explores the topics discussed. At a July 2021 meeting with the IAASB, the Fraud Working Group will present possible actions for four remaining topics where mixed responses to the Discussion Paper were received. The Working Group will also seek to obtain Board feedback on possible project objectives, project scope and public interest issues to inform the development of a project proposal to be presented at the September 2021 IAASB meeting.

• Fraud and Going Concern – AASB

• Jun 07, 2021

• At its meeting on June 7-8, 2021, the AASB provided input to the IAASB members from Canada on issues related to information the IAASB gathered on ISA 240, The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements. Key issues discussed included possible actions to: (i) address the presumed risks of fraud in revenue recognition; (ii) enhance the introductory paragraphs of the standard to clarify the auditor’s responsibilities in relation to fraud; and (iii) retain the definition of fraud but incorporate additional guidance to address how other concepts, such as bribery and corruption, may impact the auditor’s responsibilities related to fraud. Based on the information it gathered, the IAASB anticipates approving a project proposal to revise ISA 240 at a future meeting.

• Fraud and Going Concern–AASB

• Dec 14, 2020

• At its meeting on December 14, 2020, the AASB reviewed a draft response to the IAASB’s Discussion Paper In the fall of 2020, the AASB conducted outreach that informed its response. The AASB will review a draft of the complete response letter at a future meeting. The response letter will be submitted by the comment deadline of February 1, 2021.

• Fraud – IAASB

• Dec 07, 2020

• At its meeting on December 7-11, 2020, the IAASB received an update on the information gathering activities in relation to fraud in an audit of financial statements. In particular, it was highlighted that outreach was being undertaken with investor groups to further understand their views. The Board also discussed various specific matters related to the auditor’s efforts with regard to fraud within the ISAs and provided views on possible ways that the issues and challenges could be addressed. The Fraud Working Group will continue to gather information to further inform the Board’s efforts in relation to fraud in an audit of financial statements, including consideration of the responses to the IAASB Discussion Paper that is out on consultation until February 1, 2021.