IFAC rejects simplified audit standards for audits of SMEs
05 Oct 2008
The International Federation of Accountants (IFAC) has issued a policy position titled IFAC's Support for a Single Set of Auditing Standards: Implications for Audits of Small and Medium-sized Entities.
The paper sets out IFAC's view that International Standards on Auditing (ISAs) are designed to be applicable to audits of financial statements of entities of all sizes. "If auditors intend to issue an ISA audit report, they must comply with the ISAs. This enables a consistent level of assurance to be associated with the word 'audit', and allows users to make decisions in the light of a common understanding about the reliability of financial statements.' The paper points out that SMEs have an alternative to obtaining an audit – they may obtain a review of their financial statements rather than an audit. IFAC Media Release (link to IFAC website).
