Over 50 senior audit professionals from 23 international networks of accounting firms met today to contribute their perspectives on proposed revisions to auditor reporting. The symposium, organized by the Forum of Firms, assembled a group of experts to discuss the proposals outlined in the International Auditing and Assurance Standards Board (IAASB)’s public consultation, Invitation to Comment: Improving the Auditor’s Report (ITC).

Participants representing various jurisdictions and network sizes lent a variety of perspectives to the lively debate on the ITC proposals. “The symposium gave us the opportunity to collectively gain a deeper understanding of the proposals and consider the practical implications for implementation and related consequences for audit quality. The interactions raised awareness while also providing a unique opportunity for direct practitioner interaction with the IAASB on a topic that runs to the core of the auditing profession,” said David Maxwell, chair of the Transnational Auditors Committee.

Each panel discussion commenced with an overview of the existing landscape, overall summary of the relevant ITC proposals, and early indicative feedback collected by the IAASB to date. The first of two panels, Auditor Commentary—Moving Beyond Boilerplate, then explored the proposal to add a section to the standard auditor’s report on auditor commentary. The second panel, Going Concern and Other Information—Making Auditors’ Implicit Messages Explicit, focused on the call from investors to provide more information about the auditor’s responsibilities. The symposium concluded with an opportunity for participants to give their reactions to the remainder of the ITC’s proposals and the likelihood they will achieve the goal of making financial statement users understand more about the audit.

"The auditor’s report is a critical outcome from the audit, playing an important role in public confidence in audited financial statements. The Forum of Firms welcomes open discussion and debate that will contribute to enhanced audit quality,” said Robert Dohrer, chair, Forum of Firms. “It is essential that all audit firms be engaged in the global debate on audit quality so that we can consider how we, as practitioners, can better contribute to its advancement.”

About the Forum of Firms
The Forum of Firms is an association of networks of international accounting firms that perform transnational audits. Members of the Forum have committed to adhere to and promote the consistent application of high-quality audit practices worldwide, including the use of International Standards on Auditing, and the maintenance of appropriate quality control standards in accordance with International Standards on Quality Control issued by the International Auditing and Assurance Standards Board. Through their organizations, members also conduct globally coordinated internal quality assurance reviews on a regular basis and have policies and methodologies that conform to the Code of Ethics for Professional Accountants. The Transnational Auditors Committee is the Executive Committee of the Forum of Firms and a committee of the International Federation of Accountants.

About IFAC
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. It is comprised of 167 members and associates in 127 countries and jurisdictions, representing approximately 2.5 million accountants in public practice, education, government service, industry, and commerce.

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Presentation by Paul Thompson, IFAC Deputy Director, SME & SMP Affairs at the Central and South East Europe Regional Forum for Professional Accountancy Organizations co-hosted with the World Bank in Vienna on June 1, 2012. 

Presentation by Sylvia Tsen, Director, Quality and Member Relations, IFAC at the Central and South East Europe Regional Forum for Professional Accountancy Organizations co-hosted with the World Bank in Vienna on June 1, 2012. 

Presentation by Göran Tidström, IFAC president, at the REPARIS Central and South East Europe Regional Forum for Professional Accountancy Organizations co-hosted with the World Bank in Vienna on June 1, 2012.

Presentation given by SMP Committee Chair Giancarlo Attolini at the IFAC Board Meeting in September 2012 on the current and upcoming activities of the IFAC SMP Committee in each of its strategic focus areas: Input to Standard-Setting, Input to Public Policy and Regulation, Adoption and Implementation, and Development and Quality.

This article offers tips for small- and medium-sized practices (SMPs) in reacting to pressure to lower fees. While this pressure is nothing new, it has been exacerbated in many jurisdictions by the economic climate. The article was released as part of the committee’s practice management series to help IFAC members support their SMP constituents.

The article was released to IFAC member organizations to publish in their journals. For example, see below from CPA Singapore.  

In support of its commitment to explore standards for services that meet the unique needs of small- and medium-sized entities (SMEs), the International Auditing and Assurance Standards Board (IAASB) today released International Standard on Review Engagements (ISRE) 2400 (Revised), Engagements to Review Historical Financial Statements. ISRE 2400 (Revised) follows the release earlier in 2012 of International Standard on Related Services (ISRS) 4410 (Revised), Compilation Engagements, a standard also addressing services of particular relevance to SMEs.

“An important aspect of the IAASB’s strategic focus in recent years has been our response to the growing demand for assurance services, other than the financial statement audit, that help enhance the credibility of SMEs’ financial statements,” noted Prof. Arnold Schilder, IAASB chairman. “In light of this demand, it is fundamental that there be robust standards to support a diverse range of services for this important stakeholder group. ISRE 2400 (Revised) is an important contribution to this aim.”

Review engagements are of particular relevance for entities that are not required, or do not elect, to have an audit, but wish to enhance the credibility of, and confidence in, their unaudited financial statements among their users through practitioner involvement. The practitioner’s report when a review engagement has been conducted in accordance with ISRE 2400 (Revised) describes whether anything has come to the practitioner's attention that causes the practitioner to believe the financial statements are not prepared, in all material respects, in accordance with the applicable financial reporting framework. A review is a limited assurance engagement, however, and the procedures performed are substantially less than those performed in an audit conducted in accordance with International Standards on Auditing. Accordingly, the practitioner's review engagement report does not express an audit opinion on the financial statements.

“This standard enhances both the value and performance of review engagements. Through strengthened requirements and additional guidance, it helps ensure there is sufficient appropriate evidential support for the practitioner’s conclusion on the financial statements and further promotes high-quality engagements,” explained James Gunn, IAASB technical director.

The revised standard is effective for reviews of financial statements for periods ending on or after December 31, 2013. An At a Glance publication provides an overview of the revised standard.

About the IAASB
The IAASBdevelops auditing and assurance standards and guidance for use by all professional accountants under a shared standard-setting process involving the Public Interest Oversight Board, which oversees the activities of the IAASB, and the IAASB Consultative Advisory Group, which provides public interest input into the development of the standards and guidance. The structures and processes that support the operations of the IAASB are facilitated by IFAC.

About IFAC
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 167 members and associates in 127 countries and jurisdictions, representing approximately 2.5 million accountants in public practice, education, government service, industry, and commerce.

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