IFIAR’s 2021 report on audit inspection findings
The International Forum of Independent Audit Regulators (IFIAR) has released a report on the results of its tenth annual survey of inspection findings.
It is based on its Member regulators’ individual inspections of audit firms affiliated with the six largest global audit firm networks. IFIAR collected information about two categories of activities: inspections of firm-wide systems of quality control and inspections of individual audit engagements.
IFIAR Members reported in this 2021 survey that 30% of audit engagements inspected had at least one finding, down from 34% in 2020 and 47% in the first survey capturing this percentage in 2014.
The survey inspection results are predominantly for inspections of audits that concluded prior to the pandemic.
IAASB’s revised standard for group audits
The International Auditing and Assurance Standards Board (IAASB) released International Standard on Auditing (ISA) 600. The revised standard addresses special considerations that apply to audits of group financial statements (group audits).
The IAASB also developed a Basis for Conclusions and factsheet to support the implementation.
The revised standard becomes effective for audits of group financial statements for periods beginning on or after 15 December 2023.
IESBA’s new definition of a public interest entity
The International Ethics Standards Board for Accountants (IESBA) released a new definition of a public interest entity (PIE), along with other revisions in the International Code of Ethics for Professional Accountants.
The revised provisions specify a broader list of categories of entities as PIEs whose audits should be subject to additional independence requirements. Recognising the diversity in jurisdictional contexts, the IESBA encourages the national standard setters and other relevant local bodies to refine the PIE categories.
The revised PIE definition and related provisions become effective for audits of financial statements for periods beginning on or after 15 December 2024.
IAASB and IESBA’s work on sustainability matters
The IAASB and IESBA have discussed sustainability assurance and related ethical matters during their March meetings. Both Boards have set up dedicated working groups to look into sustainability matters to progress their activities in this area.
In this context, read more on the IAASB’s work here and on the planned IESBA activities here.