IESBA Proposed Technology-related Revisions to the Code (Potential Amendments to Harmonized Rule of Professional Conduct, Rule 204) [ED]

The com­ment pe­riod ends on June 20, 2022

Next steps:

The IESBA plans to review the feedback on the Exposure Draft in Q3/2022

Last up­dated:

February 2022

Overview

Har­mo­nized provin­cial Rule 204 sets out the Cana­dian pro­fes­sion’s stan­dards that en­sure Char­tered Pro­fes­sional Ac­coun­tants (CPAs) main­tain au­di­tor in­de­pen­dence dur­ing en­gage­ments they un­der­take or par­tic­i­pate in. It sets the stan­dards and re­quire­ments CPAs must main­tain as part of their pro­fes­sional con­duct. Ethics stan­dards adopted by Cana­dian provin­cial bod­ies are cre­ated in align­ment with the Code of Ethics for Pro­fes­sional Ac­coun­tants is­sued by the In­ter­na­tional Ethics Stan­dards Board for Ac­coun­tants (IESBA). Hence, changes to the IESBA Code of Ethics will need to be re­flected in Rule 204.

On February 18, 2022, the International Ethics Standards Board for Accountants (IESBA) released for public comment proposed revisions to the "International Code of Ethics for Professional Accountants (including International Independence Standards)".

The Exposure Draft Proposed Technology-related Revisions to the Code seeks to enhance the Code’s robustness and expand its relevance in an environment being reshaped by rapid technological advancements. The proposed amendments will guide the ethical mindset and behavior of professional accountants in business and in public practice as they deal with changes brought by technology in their work processes and the content of the services they provide.

Among other matters, the proposals:

  • Draw special attention to the professional competence and confidentiality imperatives of the digital age. 
  • Address the ethical dimension of professional accountants’ reliance on, or use of, the output of technology in carrying out their work. 
  • Further enhance considerations relating to threats from the use of technology as well as considerations relating to complex circumstances in applying the Code’s conceptual framework. 
  • Strengthen and clarify the International Independence Standards (IIS) with respect to technology-related non-assurance services (NAS) firms may provide to their audit clients or technology-related business relationships they may enter into with their audit clients.
  • Explicitly acknowledge that the IIS that apply to assurance engagements are applicable to assurance engagements on non-financial information, for example, environmental, social, and governance (ESG) disclosures.

The proposed revisions build on the role and mindset changes that became effective last December, and the revised NAS provisions that will become effective in December 2022.

Review the press release and proposed revisions on the IESBA's website.

 

Other de­vel­op­ments

    February 2022

    On February 18, 2022, the IESBA released for public comment Proposed Technology-related Revisions to the International Code of Ethics for Professional Accountants (including International Independence Standards). Com­ments are re­quested by June 20, 2022.

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