In 2015, the International Auditing and Assurance Standards Board (IAASB), International Ethics Standards Board for Accountants (IESBA), and the International Accounting Education Standards Board (IAESB) convened a small, cross-representational working group—the Professional Skepticism Working Group—to formulate views on whether and how each of the three boards’ sets of international standards could further contribute to strengthening the understanding and application of the concept of professional skepticism as it applies to an audit.

The global standard-setting boards for auditing, accounting ethics and accounting education today released a new publication showcasing observations and potential ways to enhance professional skepticism.

The publication, Toward Enhanced Professional Skepticism, was produced by a joint working group comprised of representatives from the International Auditing and Assurance Standards Board (IAASB), International Ethics Standards Board for Accountants (IESBA) and the International Accounting Education Standards Board (IAESB). It outlines observations about the current environment and sets out actions the global standard-setting boards will take, as well as the role that other stakeholders can play, in enhancing professional skepticism.

The importance of professional skepticism is underscored by the increasing complexity of business and financial reporting, including the greater use of estimates and management judgment, business model changes due to technological developments, and the fundamental reliance of the public on dependable financial reporting. It lies at the heart of a quality audit.

“When this initiative began, the boards were looking for input on whether and how each of their standards could contribute to strengthening the understanding and application of professional skepticism as it applies to an audit,” said Prof. Annette Köhler, Joint Working Group Chair. “We have shared our observations and recommendations with the boards, and professional skepticism now features prominently in each of the boards’ strategic considerations.”

This publication is the first ever jointly commissioned by the three boards. Each of the boards has acted on the input received; the publication also includes a snapshot of their immediate actions and longer-term studies.

About the IAASB
The International Auditing and Assurance Standards Board (IAASB) develops 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 the International Federation of Accountants (IFAC). For copyright, trademark, and permissions information, please go to permissions or contact permissions@ifac.org.

About the IAESB
The International Accounting Education Standards Board (IAESB) develops education standards, guidance, and information papers for use by IFAC member organizations under a shared standard-setting process involving the Public Interest Oversight Board, which oversees the activities of the IAESB, and the IAESB 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 IAESB are facilitated by IFAC.

About the IESBA
The International Ethics Standards Board for Accountants (IESBA) is an independent standard-setting board that develops and issues, in the public interest, high-quality ethical standards and other pronouncements for professional accountants worldwide. Through its activities, the IESBA develops the Code of Ethics for Professional Accountants, which establishes ethical requirements for professional accountants. The structures and processes that support the operations of the IESBA are facilitated by IFAC. Please visit www.ethicsboard.org for more information, and follow us on Twitter @Ethics_Board.

IAASB Technical Director Matthew Waldron hosts the June 2017 audio podcast featuring Chairman Arnold Schilder and IAASB Members Karen French and Megan Zietsman to discuss key activities and events from the board's June 19-22, 2017 meeting in New York, New York.

• 0:00 to 0:40            Introduction
• 0:41 to 5:14            Chairman’s overview
• 5:15 to 11:51           Quality Control
• 11:52 to 15:42         Networks
• 15:43 to 18:00         ISA 220
• 18:01 to 20:26         Group Audits
• 20:27 to 22:49         Closing remarks and next meeting

The International Auditing and Assurance Standards Board (IAASB) welcomes the adoption by the US Public Company Accounting Oversight Board (PCAOB) of a new auditing standard to enhance auditor’s reports by providing additional, relevant information to users, including critical audit matters.

The PCAOB’s new standard, which is subject to US Securities and Exchange Commission (SEC) approval, is comparable with the IAASB’s new and revised Auditor Reporting Standards, which require the communication of key audit matters in auditor’s reports of listed entities and became effective for December 2016 year-end audits.

“The PCAOB’s adoption of a standard to enhance auditor’s reports is a significant step forward in providing useful and relevant information to investors and other users,” said Prof. Arnold Schilder, IAASB Chairman. “Auditor’s reports are no longer “boilerplate” reports—auditors are now providing additional information about the audit, which is highly valued by users. We are particularly pleased that the PCAOB’s requirements are comparable to those of the IAASB. Coordination among standard setters is important in striving toward auditing standards that are, in principle, globally consistent.”

Two new publications comparing the IAASB and PCAOB standards have been developed by the IAASB’s Auditor Reporting Implementation Working Group. These publications will assist users in understanding the key similarities and differences between the IAASB and PCAOB requirements. Additional information on the IAASB’s new and revised Auditor Reporting Standards, as well as support materials, are available online.

About the IAASB
The IAASB develops 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 the International Federation of Accountants (IFAC). For copyright, trademark, and permissions information, please go to permissions or contact permissions@ifac.org.

Following the US Public Company Accounting Oversight Board (PCAOB)’s recent release of AS 3101, The Auditor's Report on an Audit of Financial Statements When the Auditor Expresses an Unqualified Opinion, the IAASB's Auditor Reporting Implementation Working Group has prepared a comparison between the IAASB and PCAOB standards. These publications will help improve understanding of the key aspects of the standards from both organizations.