What the Project Aims to Achieve

The IAASB is currently working on a project to revise ISA 240, The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements. In revising this standard, the IAASB aims to:

  • Clarify the role and responsibilities of the auditor for fraud in an audit of financial statements.
  • Promote consistent behavior and facilitate effective responses to identified risks of material misstatement due to fraud through strengthening ISA 240 to establish more robust requirements and enhance and clarify application material where necessary.
  • Enhance ISA 240 to reinforce the importance, throughout the audit, of the appropriate exercise of professional skepticism in fraud-related audit procedures.
  • Enhance transparency on fraud-related procedures where appropriate, including strengthening communications with TCWG and the reporting requirements in ISA 240 and other relevant ISAs.

Project Timeline

The following table sets out the project timeline. Please note that these are current targeted milestones and may change as the work in this area progresses.

Current Status of the Project

In March 2022, the Board discussed and broadly agreed with the Fraud Task Force’s proposals on proposed changes in ISA 240[1] addressing the identification and assessment of the risks of material misstatement due to fraud and communication with those charged with governance about fraud-related matters. The Board also discussed different alternatives on the way forward for transparency in reporting on fraud and agreed that all alternatives presented should be included in the planned outreach with users of financial statements.

The Board was broadly supportive of the non-authoritative guidance illustrating the relationship between and linkage of ISA 240 and other ISAs. The Fraud Task Force will finalize the guidance for publication in Q2 2022.

In June 2022, the Fraud Task Force will bring to the Board for discussion the topics highlighted in the March 2022 IAASB meeting as well as selected new topics (i.e., introduction section, definitions, the requirements related to journal entries, specialized skills and the presumption of fraud risk in revenue recognition, and the related application and other explanatory material), including drafting proposals for certain of these topics.

Task Force Information

IAASB Staff Contacts

Task Force Members


Thank you for your interest in our publications. These valuable works are the product of substantial time, effort and resources, which you acknowledge by accepting the following terms of use. You may not reproduce, store, transmit in any form or by any means, with the exception of non-commercial use (e.g., professional and personal reference and research work), translate, modify or create derivative works or adaptations based on such publications, or any part thereof, without the prior written permission of IFAC.

Our reproduction and translation policies, as well as our online permission request and inquiry system, are accessible on the Permissions Information web page.

For additional information, please read our website Terms of Use. ALL RIGHTS RESERVED.