Overview

On January 24, 2017, the International Ethics Standards Board for Accountants (IESBA) issued an Exposure Draft, Proposed Revisions Pertaining to Safeguards in the Code—Phase 2 and Related Conforming Amendments.

The proposals address safeguards-related provisions in the independence sections of the Code of Ethics for Professional Accountants pertaining to non-assurance services provided to audit and other assurance clients. The document also explains the rationale for the revisions to the non-assurance services section of the extant Code (Proposed Section 600, Provision of Non-assurance Services to an Audit Client and Section 950, Provision of Non-assurance Services to an Assurance Client);

For fur­ther de­tails see the press re­lease and on the IESBA’s website.

Other de­vel­op­ments

January 2017

On January 24, 2017, the IESAB issued an Exposure Draft, Proposed Revisions Pertaining to Safeguards in the Code—Phase 2 and Related Conforming Amendments. Com­ments are due by April 25, 2017.

Related Discussions

Phase 2 Revisions Pertaining to Safeguards in the Code - IESBA

Sept 19, 2017

• At its meeting on September 19-22, 2017, the IESBA further deliberated significant comments received on Safeguards ED-2, and related Task Force responses. The IESBA also was briefed on the outcome of the Task Force’s July 2017 teleconferences with representatives of regulatory stakeholders who responded to Safeguards ED-2, and the IFAC Small and Medium Practices (SMP) Committee. As part of its deliberations, the IESBA considered a first draft of revisions to proposed Section 600, Provision of Non-assurance Services to an Audit Client, and conforming and consistency changes to safeguards-related provisions in other sections of the proposed restructured Code. Among other matters, the IESBA discussed the adequacy and appropriateness of the provisions for evaluating and addressing advocacy threats; and whether additional guidance is needed in the Code to explain (a) the meaning of the term “appropriate professional” used in examples of actions that might be safeguards; and (b) how professional accountants and firms should determine whether an action is effective in reducing a threat to an acceptable level, and therefore qualify as a safeguard. The IESBA broadly supported the direction of the Task Force’s proposals. At its December 2017 meeting, the IESBA will consider a final draft of the safeguards provisions and related conforming amendments, with a view to approving them for inclusion in the restructured Code.

Dec 12, 2016

• At its meeting on December 12-15, 2016, the IESBA approved for exposure Phase 2 of its Safeguards project, which includes proposed revisions to the non-assurance services sections of the extant Code (i.e., proposed restructured Section 600, Provision of Non-assurance Services to an Audit Client and restructured Section 950, Provision of Non-assurance Services to an Assurance Client). The IESBA also approved proposed conforming amendments to other areas of the Code arising from the Safeguards project.