| IAASB issues two new exposure drafts |
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| Thursday, 18 October 2007 | |
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The IAASB is proposing revisions to ISA 505 to address concerns that external confirmations may not always be as reliable as expected as audit evidence.
The revisions also aim to meet requests for more rigorous requirements governing their use by auditors. The exposure draft has been prepared using the IAASB’s ‘Clarity’ drafting conventions. The proposed revised ISA addresses ‘how’ confirmations are undertaken. The IAASB is not proposing to mandate circumstances ‘when’ external confirmation procedures are required, but has requested comments on this approach. ISA 620 (Revised and Redrafted) Using the Work of an Auditor’s Expert The proposed revised ISA deals with the auditor's use of the work of a person or organization possessing expertise in a field other than accounting or auditing, employed or engaged by the auditor to assist the auditor to obtain sufficient appropriate audit evidence. It places particular emphasis on the need for the auditor to evaluate the expert's objectivity, and to establish a proper understanding with the expert of the expert's responsibilities for the purposes of the audit. To help interested parties understand the detailed differences between the proposals in the exposure drafts and the requirements of the current auditing standards in the UK and Ireland, the staff of the APB have prepared a table comparing the objectives and requirements in them. Copies of the IAASB’s exposure drafts can be downloaded free of charge from the IAASB’s website (www.ifac.org/IAASB). They include Explanatory Memoranda that give further explanation of the proposals and details of how to respond directly to the IAASB. The APB staff’s comparison of the proposed new objectives and requirements to the requirements in the current standards can be found in the Publications (IAASB Clarity Documentation) section of the APB’s website (www.frc.org.uk/apb). Richard Fleck, Chairman of APB, commented: “These exposure drafts represent further steps in the global programme to revise auditing standards and enhance the quality of auditing. The APB would welcome comments on the exposure drafts before it responds to the IAASB.” The IAASB’s comment period for the exposure drafts ends on 15 February 2008. The APB would welcome comments on the exposure drafts from auditors and other interested parties by 18 January 2008, before it prepares its responses to the IAASB. Related links |
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