Assurance Engagements Other than Audits or Reviews of Historical Financial Information
This is a completed project
Objective(s) of project
The objective of this project is revise International Standard on Assurance Engagements (ISAE) 3000, Assurance Engagements Other than Audits or Reviews of Historical Financial Information.
This project will also consider whether, and if so to what extent, separate ISAEs applicable to all assurance engagements are needed to deal with topics such as: planning; using the work of experts; and documentation.
It will also likely result in conforming amendments to the International Framework for Assurance Engagements, and subject matter-specific ISAEs (e.g. ISAE 3402, Assurance Reports on Controls at a Service Organization).
The purpose of revising ISAE 3000 is:
(i) to incorporate enhanced requirements and guidance in the light of relevant concerns raised by stakeholders and the extensive and growing use of ISAE 3000 by professional accountants and National Standard Setters around the world, and (ii) to adopt the clarity drafting conventions.
Task Force progress / Board discussions to date
The IAASB approved the project proposal at its March 2009 meeting (Agenda Item 4).
Issues Papers were considered at the IAASB June 2009 (Agenda Item 5) and December 2009 (Agenda Item 5)meetings.
The IAASB considered a further issues paper and a working draft at its March 2010 meeting (Agenda Item 4).
The IAASB Consultative Advisory Group (CAG) has considered this project at its March 2009 (Agenda Item G) and March 2010 (Agenda Item H) meetings.
Issues considered in these meetings included:
- The nature and extent of requirements in ISAE 3000;
- Whether ISAE 3000 should be written for all professional accountants, professional accountants who are assurance professional, or assurance professionals whether they are professional accountants or not;
- The distinction between assertion-based and direct reporting engagements, and between direct reporting engagements and compilations;
- Whether any assurance engagements with respect to historical financial information should be covered by ISAE 3000;
- Common misconceptions about the two levels of assurance (reasonable assurance and limited assurance);
- The parties to an assurance engagement; and
- The structure of the ISAE section of the Handbook.
Drafts of an exposure draft and further issues for discussion have been presented for consideration at the IAASB's June 2010 (Agenda Item 6), September 2010 (Agenda Item 6), and December 2010 (Agenda Item 6) Board meetings and September 2010 IAASB CAG meeting (Agenda Item R).
At its March 2011 meeting (Agenda Item 2), the IAASB considered a revised draft of proposed revised ISAE 3000 and proposed conforming amendments to the International Framework for Assurance Engagements, ISAE 3402 and proposed revised ISAE 3410, Assurance Engagements on Greenhouse Gas Statements. Issues discussed by the IAASB include the following:
- The practitioner's objective;
- The definition of reasonable assurance, limited assurance and attestation engagement;
- The definition of misstatement, particularly its application to direct engagements;
- The collective competence and capabilities of the persons performing the engagement; and
- Developing an understanding of internal control, particularly in the context of limited assurance
The IAASB approved the proposed revised ISAE for exposure in April 2011 with a comment deadline of August 31, 2011.
At its June 2012 meeting (Agenda Item 4), the IAASB provided input on certain key directional issues arising from comments received on the exposure draft. The IAASB agreed to proceed with the revision of ISAE 3000 as per the project proposal, including giving consideration to whether the commends received on exposure give rise to opportunities to clarify the concepts underlying ISAE 3000, and to continue to address direct engagements in the revised ISAE.
The IAASB CAG discussed the project at its September 2012 meeting (Agenda Item D).
At its September 2012 meeting (Agenda Item 3), the IAASB discussed Task Force proposals in response to respondents' comments on selected issues arising from the exposure draft of proposed ISAE 3000 (Revised). Among other matters, the IAASB provided input on the definitions and work effort required for both reasonable and limited assurance engagements.
At its December 2012 (Agenda Item 5) meeting, the IAASB discussed Task Force proposals in relation to respondents’ comments on selected issues arising from the exposure draft of proposed ISAE 3000 (Revised). Amongst other matters, the IAASB provided input on the terminology to express the work effort required for both limited assurance and reasonable assurance engagements, and discussed Task Force proposals addressing direct engagements.
At its February 2013 meeting (Agenda Item 3), the IAASB received a presentation providing further background on the nature and scope of direct engagements, along with examples of direct engagement assurance reports. The IAASB discussed how the features of direct engagements relate to concepts in proposed ISAE 3000 (Revised).
The IAASB CAG discussed the project at its April 2013 meeting (Agenda Item F).
At its April 2013 meeting (Agenda Item 4), the IAASB discussed a proposed revised draft of ISAE) 3000 (Revised). Amongst other matters, the IAASB deliberated issues and options on the approach to be taken with respect to direct engagements. The IAASB noted that addressing both attestation and direct engagements in a single standard results in a very complex document, and that the approach being taken by the task force may not adequately serve the needs of those that would look to the standard when performing direct engagements. Taking into account the need to complete work on ISAE 3000 (Revised) in the near future and the importance of achieving a high-quality standard, the IAASB agreed that the standard should focus on attestation engagements. Although there will be only limited references to direct engagements, practitioners may use the ISAE, adapted as appropriate, for such engagements. The IAASB also discussed different ways of wording the assurance conclusion for attestation engagements and the definition of limited assurance.
The IAASB CAG discussed the project at its September 2013 meeting (Agenda Item E).
At its September 2013 meeting (Agenda Item 2), the IAASB approved for issuance International Standard on Assurance Engagements (ISAE) 3000 (Revised), Assurance Engagements Other than Audits or Reviews of Historical Financial Information. The IAASB also approved conforming amendments to the International Framework for Assurance Engagements; ISAE 3402, Assurance Reports on Controls at a Service Organization; ISAE 3410, Assurance Engagements on Greenhouse Gas Statements; and ISAE 3420, Assurance Engagements to Report on the Compilation of Pro Forma Financial Information Included in a Prospectus.
ISAE 3000 (Revised) and related conforming amendments are effective for assurance engagements when the assurance report is dated on or after December 15, 2015.
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