International Standard on Auditing for Less Complex Entities

ISA for LCE adoption remains limited across Europe

Adoption of the International Standard on Auditing for Audits of Financial Statements of Less Complex Entities (ISA for LCE) remains limited and concentrated in the Nordic countries. The standard provides an alternative to the full suite of International Standards on Auditing (ISAs) for eligible audits of less complex entities and offers the same level of assurance: reasonable assurance. It applies to audits of financial statements for periods beginning on or after 15 December 2025 in jurisdictions that adopt it or permit its use.

ISA for LCE adoption and implementation across 32 jurisdictions

This factsheet maps adoption and implementation across 32 jurisdictions: the 27 EU Member States, Iceland, Norway, Switzerland, Turkey and the United Kingdom. The mapping shows that:

• Eight jurisdictions have adopted the standard or permit its use
• All five Nordic countries have adopted the standard or permit its use
• Only 3 of the other 27 jurisdictions have adopted the standard or permit its use, around 11%
• Switzerland and Turkey have identified planned adoption timelines

What factors influence adoption of the ISA for LCE?

Lower audit exemption thresholds may increase the standard’s relevance where more small undertakings require statutory audits. However, the information collected does not establish a clear relationship beyond the Nordic countries. National approaches may also be influenced by the reluctance of the Committee of European Auditing Oversight Bodies (CEAOB) to support the ISA for LCE, although no direct link has been established. Review engagements and national auditing standards may reduce the perceived need for a separate LCE standard. Other considerations include concerns about creating a parallel auditing framework and whether the anticipated benefits outweigh the implementation effort. Accountancy Europe encourages the CEAOB and relevant national organisations to exchange views on the standard’s relevance and possible use.

Country-specific information and Accountancy Europe’s work on LCE audits

The factsheet provides further jurisdiction-specific information based on responses from our Member Bodies and other national organisations. It also outlines our work on audits of LCEs since 2018 through publications, consultation responses, letters and public events. We will continue to monitor developments and update the factsheet as adoption progresses.