Overview

Users of audited financial statements had asked auditors to provide more information in their reports about significant matters in the financial statements, as well as about the conduct of the audit. The IAASB (and the AASB) agreed that a quality audit should be accompanied by an informative auditor’s report that delivers value to the entity’s stakeholders.

As a result, the IAASB undertook, and, in January 2015, completed a project to revise its auditor reporting standards. And, in April 2017, the AASB unanimously approved similar new and revised CASs relating to auditor reporting, and the auditor’s responsibilities relating to other information.  See the Completed Project.

The new and revised auditor reporting standards were effective for audits of financial statements for periods ending on or after December 15, 2018. In accordance with its normal process, both the IAASB and the AASB are now starting to conduct a post-implementation review of these new and revised standards.

On September 2, 2020, the AASB issued a survey to stakeholders regarding the new and revised standards. Comments are requested by October 9, 2020. The survey aims to:

• determine whether the standards are being consistently understood and implemented in a manner that achieves their intended purposes; 
• identify how practical challenges and concerns are being addressed;
• understand the extent of demand for additional information in the auditor’s report to improve transparency about the audit, including for example, additional communications about going concern, disclosures about materiality, and information about the scope of the audit; and
• understand the extent of demand for wider application of those requirements that currently apply only to audits of financial statements of listed entities (e.g., whether requirements dealing with disclosure of the name of the engagement partner should apply to entities other than listed entities).

The IAASB’s Auditor Reporting Implementation Working Group (ARIWG) also undertook a post-implementation review (PIR) of the new and revised auditor reporting standards in order to:

• determine whether the new and revised standards are being consistently understood and implemented in a manner that achieves the IAASB’s intended purpose when developing them.
• identify how practical challenges and concerns are being addressed by stakeholders and if any action is required.
• understand the global demand for additional information in the auditor’s report.
• understand the global demand for wider application of the new and revised auditor reporting requirements.

On June 2, 2021, the IAASB published a Feedback Statement after a public consultation. Stakeholders expressed broad support for the standards, and the resulting auditor’s report, and indicated that the standards have met the IAASB’s objectives.

The stakeholder Feedback Statement summarizes key themes and views shared with the IAASB through the 2020 Auditor Reporting Post-Implementation Survey as well as a roundtable discussion held in September 2020. The survey, roundtable, and related outreach solicited perspectives on implementation and specific aspects of the revised auditor reporting standards. Three of the key areas of focus for stakeholders were key audit matters, going concern and other information in the auditor’s report. The IAASB’s Auditor Reporting Implementation Working Group is considering the feedback in developing its post-implementation review recommendations for the IAASB’s consideration in September 2021.

Other De­vel­op­ments

June 2021

On June 2, 2021, the IAASB published a Feedback Statement after a public consultation. Stakeholders expressed broad support for the standards, and the resulting auditor’s report, and indicated that the standards have met the IAASB’s objectives.

September 2020

On Sep­tem­ber 2, 2020, the AASB released a survey to obtain Canadian stakeholders’ views on the enhanced auditor reporting standards.