DOWNLOAD THE ILLUSTRATIVE EXAMPLES HERE

The IAASB's International Standard on Auditing (ISA) 540 (Revised) Implementation Working Group has prepared illustrative examples for auditing simple and complex accounting estimates. The examples are designed to illustrate how an auditor could address certain requirements of ISA 540 (Revised), and have been developed to assist the auditor in understanding how ISA 540 (Revised) may be applied to:

•  Simple Accounting Estimate – Provision on Inventory Impairment
• Complex Accounting Estimate – Provision on Property, Plant and Equipment Impairment

The examples illustrate accounting estimates with varying characteristics and degrees of complexity. Each example illustrates a selection of requirements from ISA 540 (Revised). Not all requirements are addressed in each example, nor do they cover all parts of those requirements that have been selected. The requirements selected across each example vary to illustrate different aspects of ISA 540 (Revised) and to focus on those requirements that are most relevant to the example.

These examples are intended to be read together with ISA 540 (Revised). This will demonstrate how an auditor’s work effort, to comply with the requirements of ISA 540 (Revised), may be scaled down and scaled up when auditing simple and complex accounting estimates.

Click here for for more information and to view the illustrative examples. 

These examples do not constitute an authoritative pronouncement of the International Auditing and Assurance Standards Board (IAASB), nor do they amend, extend or override the ISAs or other of the IAASB’s International Standards. It is not meant to be exhaustive and reading these examples is not a substitute for reading the ISAs.

Additional illustrative examples are being developed to illustrate how an auditor may address the requirements of ISA 540 (Revised) in the context of more complex accounting estimates such as those relating to expected credit losses, and will be released in due course.

The IAASB invites you to join its webinar covering the previously released Public Consultation on Proposed Guidance: Extended External Reporting (EER) Assurance. The Consultation Paper is open for comment until July 13, 2020.

The webinar will be held on June 10, 2020 from 7am – 8.30am EDT

In this 90-minute webinar Lyn Provost, IAASB Member and Chair of the EER Task Force, will explain:

• what is meant by Extended External Reporting (EER)
• how EER Assurance engagements provide protection for the public interest
• how the IAASB’s proposed EER Assurance Guidance seeks to serve the public interest by:
• providing practical guidance on particular challenges practitioners face in performing EER assurance engagements,
• promoting consistent high-quality application of ISAE 3000 (Revised) to these engagements, and
• enhancing trust in assurance reports and engendering greater user confidence and trust in the reliability of EER reports.

Time will be provided during this webinar to answer questions. The webinar is open to preparers and users (including investors) of EER reports, as well as to assurance practitioners and regulators.

Our new tool makes it easy for stakeholders to navigate and access key accountancy education principles and related implementation support.

In 2014, Nana Yasuda founded iProfess Partners LLC in Tokyo, offering translation/interpretation and IR consulting services mainly to Japanese organizations, including the Japanese Institute of CPAs, major audit firms and listed companies, and to foreign investment funds seeking investment opportunities in Japan. The organization is dedicated to using clear and concise language with a goal to improve communication is supported by a strong background in accounting and finance. Since November 2020, Ms. Yasuda has also closely supported Mr. Kohei Kan in his role as an IFAC Board member.

Ms. Yasuda has over 10 years of working experience with Deloitte Touche in Japan and the U.S. She has extensive knowledge in the field of auditing, M&A financial due diligence, and IFRS, underpinned by her professional background, which includes:

• Provided audit service mainly to IT companies in Silicon Valley in the US
• As a project manager in corporate finance, providing cross-border financial due diligence and evaluation services to more than 20 multi-national companies (Tokyo, Japan)
• Spent three years in IFRS research center, offering technical advice to firm members (Tokyo, Japan)
• Established an in-house translation department and rendered English/Japanese translation/interpretation services to more than 50 clients over three years (Tokyo, Japan)

Ms. Yasuda started her professional career as an analyst at a Japanese venture capital firm, Japan Asia Investment Co. Ltd. She has a bachelor of arts in economics from KEIO University in Japan.

As a result of the COVID-19 pandemic and the unprecedented sums of relief money moving across the global economy, the threat of financial crimes and malfeasance continues to grow. In this context, CPA Canada and the International Federation of Accountants (IFAC) today published a report that explores a key facet of uncovering and fighting illegal activities: beneficial ownership transparency.

The fight against money laundering, corruption and tax evasion requires the participation of several stakeholders, including accountants, who rely on strong legal frameworks and accurate information.

“Beneficial ownership information, which identifies who has controlling ownership of an entity, is important to the discovery of financial crimes,” said CPA Canada President and CEO Joy Thomas. “Enhancing the transparency of this information should strengthen anti-money laundering regimes and help in seeking out lawbreakers and their proceeds of crime.”

The report, “Approaches to Beneficial Ownership Transparency: The Global Framework and Views from the Accounting Profession”, contributes to the global conversation as countries grapple with questions regarding the extent to which, and by whom, beneficial ownership information is collected, reviewed and made available. Central to this discussion is the concept of beneficial ownership registers and registries.

In examining how various countries are complying with the recommendations from the Financial Action Task Force (FATF) on transparency and beneficial ownership information, and with the perspectives of senior accounting leaders across the globe, the report finds that:

• Establishing a public beneficial ownership registry does not immediately ensure that a country’s law enforcement and other agencies have access to accurate information in a timely manner. 
• In several jurisdictions, the move to a public registry has been a phased approach, starting with non-public registries and then transitioning to public registries; and
• Verifying information and ensuring appropriate levels of access are key factors in a registry’s efficacy.

“The global accountancy profession, with its strong public interest mandate, is a committed partner in the fight against financial crime,” said Kevin Dancey, IFAC CEO. “We are eager to advance important policy conversations, including those over beneficial ownership, and to work meaningfully alongside governments, law enforcement and other stakeholders to combat financial crime in all its forms.”

With this report, the authors offer considered insights on the most effective ways to comply with international anti-money laundering standards. To view the first report, visit:  cpacanada.ca/beneficialownership.

About IFAC
The International Federation of Accountants (IFAC) is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of more than 175 members and associates in more than 130 countries and jurisdictions, representing more than 3 million accountants in public practice, education, government service, industry, and commerce.

About CPA Canada
Chartered Professional Accountants of Canada (CPA Canada) represents the Canadian accounting profession, both nationally and internationally. Operating in the highly complex and global accounting ecosystem, CPA Canada is a convener, facilitator, contributor and disseminator of information that advances the profession. The organization works closely with the provincial, territorial and Bermudan CPA bodies to champion best practices that benefit business and society. With more than 217,000 members, CPA Canada is one of the largest national accounting bodies in the world. The organization supports the setting of accounting, auditing and assurance standards, advocates for economic and social development in the public interest, and develops leading-edge thought leadership, research, guidance and educational programs. cpacanada.ca

For more information:
Perry Jensen
Media Relations Manager
Chartered Professional Accountants of Canada
Tel: 416-204-3941
Cell: 647-807-4798
Email: pjensen@cpacanada.ca

Geena De Rose
IFAC Communications
Tel: 646-277-9390
Email: geenaderose@ifac.org