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Reporting by auditors on compliance with IFRS

  • IFAC (International Federation of Accountants) (lt gray) Image

11 Apr 2003

The International Auditing and Assurance Standards Board has issued International Auditing Practice Statement 1014 to provide guidance when the auditor expresses an opinion on financial statements that are asserted by management to be prepared: Solely in accordance with International Financial Reporting Standards (IFRSs); In accordance with both IFRSs and a national financial reporting framework; or In accordance with a national financial reporting framework with disclosure of the extent of compliance with IFRSs. Regarding compliance with both IFRS and national GAAP, IAPS 1014 states: Simultaneous compliance with both IFRSs and a national financial reporting framework is unlikely unless the country has adopted IFRSs as its national financial reporting framework or has eliminated all barriers for compliance with IFRSs.

It is helpful for the auditor to discuss financial statements that state they have been prepared in accordance with IFRSs and a national financial reporting framework with management and those charged with governance. The purpose of the discussion is to advise management and those charged with governance of the possibility of a qualified opinion or adverse opinion on compliance with one or both of the financial reporting frameworks, given that the ability to simultaneously comply fully with IFRSs and a national financial reporting framework is unlikely. IAPS 1014 supplements guidance provided in International Standard on Auditing 700, The Auditor's Report on Financial Statements. The IAASB has also released two exposure drafts regarding assurance engagements and audits of small business. All IAASB documents are available without charge on the IAASB's Web Pages. Click for IFAC News Release.

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