NZAuASB Update 18/2020
Recent NZAuASB Meeting, IAASB update on Fraud and Going Concern, new separate standard for LCEs...
|This NZAuASB Update provides you with an overview of the New Zealand Auditing and Assurance Standards Board’s recent activities, any new standards or FAQs, as well as other matters of interest.
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The NZAuASB and the Assurance Team at the XRB wish you all the best for the holiday season. Thank you for your contribution to our work programme over the past year. Your comments and feedback are an important part of making sure our standards are appropriate for the New Zealand Reporting environment.
The XRB will be closed from on Wednesday 23 December 2020 and re-opens on Wednesday 6 January 2021.
Recent NZAuASB Meeting
AuditingProfessional & EthicalRelated Services
Highlights of the December meeting included:
- Consideration of the NZAuASB’s response to the IAASB’s discussion paper on fraud and going concern in light of stakeholder feedback;
- Meeting with stakeholders from the investor community;
- Consideration and final approval of the Agreed-Upon Procedures Engagement Standard, without any New Zealand changes;
- Approval of an exposure draft for “Annual Improvements” to the NZ ISAs; and
- Further discussion of the Principles of Conversion to international standards and Harmonisation Policy with Australian standards.
IAASB Fraud and Going Concern Roundtables
The IAASB has released a key takeaways publication following recent virtual roundtables with experts and leaders exploring issues and challenges related to fraud and going concern.
These roundtables focussed on:
- The impact of technology advancements on fraud perpetration and detection;
- The “expectation gap”, or differences between public perceptions and the auditor’s responsibilities for fraud and going concern; and
- Fraud and going concern in audits of less complex entities.
The input from these roundtables comprises one aspect of the IAASB’s broader information-gathering activities related to fraud and going concern that will be considered in determining possible further actions.
IAASB to develop separate standard for audits of less complex entities
During its December 2020 meeting, the IAASB held its first public discussions on the draft of a separate standard being developed for an audit of less complex entities and the official project proposal to complete and publish the draft standard for public consultation in 2021. The IAASB approved the project proposal and early draft.
The NZAuASB is monitoring the development of the LCE standard with great interest and providing input into the process.
Following these decisions, the IAASB published a new communique detailing plans for the new standard, including current thinking on what the standard will look like, what entities it will apply to, and the development timeline.
The IAASB's November Communique addresses additional information on its efforts to balance the needs of all its stakeholders by addressing complexity, understandability, scalability and proportionality in the International Standards on Auditing.
Have your say...
We are currently consulting on the matter set out in the table below.
We welcome your comments and feedback, either formal or informal, by the due dates below.
You can submit your comments directly from the Exposure Draft page on our website following the links below.
Comments Due to NZAuASB
Comments Due to IAASB
Fraud and Going Concern in an Audit of Financial Statements
30 Nov 2020
12 Jan 2021
This NZAuASB Update is intended to provide subscribers with a summary of the recent activities of the New Zealand Auditing and Assurance Standards Board (NZAuASB). Links to websites are correct at the time of publication. Subscribers should not rely on this newsletter as a definitive publication of updates. The External Reporting Board and its sub-Board the NZAuASB do not guarantee, and accept no legal liability whatsoever arising from or connected to, the accuracy, reliability, currency, timeliness or completeness of this newsletter. The information contained in this newsletter does not constitute advice and should not be relied upon as such.