Page 1 | Proprietary and Copyrighted Information Emerging Issues and Outreach Reyaz Mihular, Chair...

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Emerging Issues and Outreach Reyaz Mihular, Chair Emerging Issues and Outreach Committee IESBA Board Meeting October 13-15, 2015 New York

Transcript of Page 1 | Proprietary and Copyrighted Information Emerging Issues and Outreach Reyaz Mihular, Chair...

Page 1: Page 1 | Proprietary and Copyrighted Information Emerging Issues and Outreach Reyaz Mihular, Chair Emerging Issues and Outreach Committee IESBA Board Meeting.

Page 1 | Proprietary and Copyrighted Information

Emerging Issues and Outreach

Reyaz Mihular, Chair Emerging Issues and Outreach Committee

IESBA Board Meeting

October 13-15, 2015

New York

Page 2: Page 1 | Proprietary and Copyrighted Information Emerging Issues and Outreach Reyaz Mihular, Chair Emerging Issues and Outreach Committee IESBA Board Meeting.

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Global Adoption of the Code

• April Board meeting– Good first step – especially for G-20 Countries– Snap shot in time– Disparate nature of adoption– Responsibility for overseeing adoption

Page 3: Page 1 | Proprietary and Copyrighted Information Emerging Issues and Outreach Reyaz Mihular, Chair Emerging Issues and Outreach Committee IESBA Board Meeting.

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Global Adoption of the Code

• September CAG meeting– How categories of adoption defined?– Measurement of adoption can be resource intensive – How do jurisdictions adopt latest changes?– Understand nature and extent of differences– Highest standard vs. lowest common denominator?

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International Forum of Independent Audit Regulators (IFIAR)

Inspection Reports

• Main findings:– Audit of listed PIEs: fair value measurements; internal

control testing; adequacy of financial statements– Audits of SIFIs and G-SIBs: loan losses and impairments;

control testing; valuation of investment and securities– Quality control systems: engagement performance; human

resources; ethics and independence

Page 5: Page 1 | Proprietary and Copyrighted Information Emerging Issues and Outreach Reyaz Mihular, Chair Emerging Issues and Outreach Committee IESBA Board Meeting.

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International Forum of Independent Audit Regulators (IFIAR)

Inspection Reports

• Matters pertaining to independence:– Engagement quality control reviews– Independence considerations– Provisions / reserves

• Inspection findings – targeted actions to improve audit quality

• Greater liaison with IFIAR

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UK Financial Reporting Council (FRC)

Inspection Reports

• Key areas needing improvement:– Focus on audit quality– Need to maintain professional skepticism– Audits of financial services entities– Group audits– Independence and Ethics – boiler plate approach– Audit quality monitoring

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UK Financial Reporting Council (FRC)

Inspection Reports

• Independence:– Good standard of independence from auditors

• Ethics– NAS selling targets in partner appraisals

– Contingent fee arrangements on tax services

– Rotation of KAPs from other network firms

– Disposal of shareholdings in audited entities

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Canadian Public Accountability Board (CPAB)

Inspection Reports

• Main findings:– Trend in audit quality is positive– Challenge to improve audit quality being taken seriously– Improvement due to action plans– Concerns over overseas audits– TCWG should discuss audit quality with auditors

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Other Matters

• EU Audit Reform– Liesbet Haustermans

• Outreach

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The Ethics Boardwww.ethicsboard.org