The September meeting highlights feature updates on the IESBA’s current projects and initiatives, including: Long Association, Structure of the Code of Ethics for Professional Accountants (the Code), Safeguards, Part C, and Professional Skepticism. The IESBA also was briefed on the progress of the review of academic and other literature on the topic of fees, and considered proposed IESBA Staff Q&As on its recently released standard addressing non-compliance with laws and regulations (NOCLAR).

The IESBA unanimously approved final changes to the Code relating to the long association of firm personnel with an audit or assurance client. The IESBA plans to hold a teleconference in November 2016 to agree on the effective date of the revised provisions. Subject to Public Interest Oversight Board approval, these changes, developed under the current structure and drafting conventions for the Code, will be made available on the IESBA website by the end of the year.

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At its September meeting, the IESBA also considered preliminary recommendations from the joint Professional Skepticism Working Group—comprising representatives of the IESBA, International Auditing & Assurance Standards Board (IAASB), and International Accounting Education Standards Board—on actions that the three standard-setting boards could take, individually and in coordination, to enhance the application of professional skepticism in their respective standards, following an update on feedback to the IAASB’s Invitation to Comment (ITC). The IESBA agreed to explore the feasibility of short-term enhancements to the Code, potentially for public exposure in early January.

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The Consultative Advisory Group (CAG) meeting started with a joint session with the IAASB CAG to receive report-backs on the boards’ respective NOCLAR projects, and to discuss matters arising from the preliminary work of the boards’ joint Professional Skepticism Working Group—see left. The IESBA CAG meeting continued with CAG representatives discussing and/or providing input on several board projects—Structure, Safeguards, Part C, and Long Association—followed by an update on the fees initiative.

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At its September 14-16 meeting, the Public Interest Oversight Board (PIOB) approved the nominations recommended by the Nominating Committee for the 2017 composition of the IESBA, and other groups it oversees. Two of the IESBA members will be retiring from the board at the end of the year. IESBA Chairman Dr. Stavros Thomadakis attended a joint session with the Chairs of the CAGs of the other standard-setting board to discuss common issues and the PIOB’s 2017-2019 Strategy consultation, among other issues.

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Anne Molyneux, representing the International Corporate Governance Network on the IESBA CAG, explains how the new NOCLAR standard can enhance corporate governance and support the public interest, urging all those in the financial reporting supply chain—not only accounting professionals but also regulators and lawmakers—to understand they have a role in preventing and bringing to light potential non-compliance with laws and regulations.

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Lucy Elliott, representing the Organisation for Economic Co-operation & Development (OECD) on the IESBA CAG, illuminates key aspects of the OECD’s Anti-Bribery Convention, and explains how the Convention and the IESBA’s NOCLAR standard share key public interest objectives, including fighting the global scourges of bribery and corruption. She calls on regulators to consider strengthening jurisdictional whistleblower protections, which would enable compliance with the Convention requirements and complement and support the new IESBA standard.

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Matt Waldron, representing the CFA Institute on the IESBA CAG, discusses the new NOCLAR standard’s relevance to the investment community, particularly how the standard can enhance trust and confidence in organizations. He also explains how corporate governance, including tone at the top, is critical to creating a culture that discourages non-compliance and encourages speaking up and reporting instances of possible non-compliance with laws and regulations.

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