Skip to main content

Latest On Our Projects

Hands holding pen and papers

Audit Evidence

Updated April 2023

In October 2022, the IAASB released an exposure draft on proposed ISA 500 (Revised), Audit Evidence for public comment until April 24, 2023.

The key changes proposed include:

  • Clarifying the purpose and scope of the standard and explaining its relationship with other standards.
  • A principles-based approach to considering the relevance and reliability of information to be used as audit evidence and evaluating whether sufficient appropriate audit evidence has been obtained, recognizing the changing nature and number of information sources used by auditors in today’s world.
  • Increased recognition of the use of technology by the entity and the auditor, including the use of automated tools and techniques.
  • More emphasis on the role of professional skepticism when making judgments about information to be used as audit evidence and evaluating audit evidence obtained.

The proposed revisions provide a “reference framework” for auditors when making judgments about audit evidence throughout the audit.

The next discussion is in December 2023, when the IAASB will consider respondents feedback to the exposure draft.

For further information, visit the Audit Evidence project page

Colorful dots and connecting lines

Audits of Financial Statements of Less Complex Entities

Updated April 2023

Since the public consultation on proposed ISA on Auditing for Audits of Financial Statements of Less Complex Entities was issued in July 2021, the IAASB has been considering feedback and progressing the separate standard’s finalization. Among the key matters discussed are:

  • Group audits: In the original proposed standard, group audits were excluded from the scope. Based on feedback, this was reconsidered and a new part, Part 10, Audits of Group Financial Statements was issued for public consultation in December 2022, and published in January 2023 with comments due by May 2, 2023.
  • Authority of the proposed standard: Respondents to the initial public consultation expressed concerns that the proposed Authority involved too much judgment and may, therefore, lead to inconsistent or inappropriate use of the standard. To clarify the scope, the IAASB agreed to enhance the description of the qualitative characteristics and include an expectation for jurisdictions to determine quantitative thresholds.
  • Approach to proportionate requirements for LCEs: Respondents to the initial public consultation encouraged the IAASB to further consider how the requirements reflect the principles of scalability and proportionality appropriate to the typical nature and circumstances of LCEs. In response, the IAASB has discussed revisions to Part 2, Audit Evidence and Documentation, Part 3, Engagement Quality Management, Part 6, Risk Identification and Assessment and accounting estimates in Part 7, Responding to Assessed Risks of Material Misstatement.
  • Revisions to other parts: Responses to Part 4, Acceptance or Continuance of an Audit Engagement and Initial Audit Engagements and Part 5, Planning were analyzed and revisions to these parts were made.

The next discussion is in June 2023 when the IAASB intends to discuss a full draft of the proposed standard, excluding Part 10. 

For further information, visit the ISA for LCE project page.

Padlock and digital background


Updated April 2023

The IAASB is revising ISA 240, The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements. Since the approval of the project proposal in December 2021, the IAASB discussed this project at its March, June, September, and December meetings in 2022. Among the key matters discussed to date are:

  • The role and responsibilities of the auditor for fraud in an audit of financial statements. Changes are being considered to emphasize and clarify the auditor’s responsibilities, and reduce the ambiguity between the inherent limitations of an audit and the auditor’s responsibilities.
  • Identifying and assessing risks of material misstatement due to fraud. The IAASB is considering revisions to enhance and clarify requirements and application material to incorporate changes resulting from ISA 315 (Revised 2019), Identifying and Assessing the Risks of Material Misstatement.
  • The overall approach when fraud or suspected fraud is identified by the auditor.
  • Transparency of fraud-related matters in the auditor’s report. The IAASB agreed that additional disclosures on fraud should be included in the auditor’s report of listed entities, and clearly signposted, such that the users of the financial statements are able to find matters relating to fraud. The IAASB is considering a filter, similar to that used for key audit matters in ISA 701, Key Audit Matters, for determining the risks of material misstatement due to fraud to be communicated.
  • Enhancements to communications with those charged with governance, the need for specialized skills, the presumed risk of fraud in revenue recognition, and journal entry testing.

A progress update was provided to the IAASB’s Consultative Advisory Group in March 2023. The next discussion with the IAASB is in June 2023, when a near final draft of proposed ISA 240 (Revised), The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements, will be reviewed. The IAASB is working toward approving the exposure draft in December 2023.

Concurrently with revisions to ISA 240, in May 2022, the IAASB released non-authoritative guidance that illustrates the relationship between ISA 240 and other ISAs when planning and performing an audit engagement and reporting thereon.

For further information, visit the Fraud project page


Going Concern

Updated April 2023

In March 2023, the IAASB approved an exposure draft for proposed ISA 570 (Revised 202X), Going Concern (the IAASB March agenda papers, including the final approved text of the proposed revised standard, are available on our website in Meetings). The proposed revised standard will be issued for public consultation in early May 2023 with a 120-day consultation period.

The key proposed enhancements include:

  • Defining the term “material uncertainty (related to going concern)” and providing clarity for other terminology used in the standard (e.g., for the phrase “may cast significant doubt”).
  • Changing the commencement date of the period of management’s assessment of an entity’s ability to continue as a going concern to at least twelve months from the date of approval of the financial statements.
  • Strengthening requirements that:
    • Drive the auditor to obtain information that is relevant to the timely identification of events or conditions that may cast significant doubt on the entity’s ability to continue as a going concern; and
    • Require a more robust evaluation of management’s assessment, including evaluating the method, assumptions and data used by management.
  • New requirements when management’s plans for future actions include financial support by third parties or related parties, including the entity’s owner-manager, for the auditor to evaluate the intent and ability of those parties to maintain or provide the necessary financial support.
  • Enhancing requirements and application material to enable a more robust exercise of professional skepticism when performing audit procedures, including when evaluating whether there are indicators of possible management bias.
  • Enhancing application material addressing scalability, which includes examples that demonstrate how the nature and extent of the auditor's procedures may vary based on the nature and circumstances of the entity.
  • With respect to the auditor’s work related to going concern:
    • Emphasizing how information from sources external to the entity may be leveraged; and
    • Modernizing the standard for the impact of technology.
  • Strengthening the requirements for timely, two-way communications with those charged with governance and including new requirements for communication with appropriate external parties.
  • Enhancing transparency about going concern in the auditor’s report, including:
    • Providing explicit statements about going concern in all instances (i.e., for audits of financial statements of all entities); and
    • For audits of financial statements of listed entities, describing how the auditor evaluated management’s assessment.

For further information, visit the Going Concern project page.


Listed Entities and Public Interest Entities (PIEs)

Updated April 2023

The IAASB is considering narrow-scope revisions to the ISAs and ISQMs to respond to recent revisions to the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including International Independence Standards) regarding listed and public interest entities. The project has two tracks:

  • Track 1: A fast-moving track focused on enhancing transparency about independence in the auditor’s report.
  • Track 2: Exploring revisions to the ISAs and ISQMs regarding the differential requirements for listed entities and the definition of listed entities, including whether the differential requirements should apply to PIEs.

Track 1

Following the 2022 public consultation for proposed revisions to ISA 700 (Revised), Forming an Opinion and Reporting on Financial Statements; and ISA 260 (Revised), Communication with Those Charged with Governance, the IAASB discussed respondents’ feedback from the public consultation and the proposed way forward during its March 2023 meeting. The final approval of the Exposure Draft is planned for June 2023.

Track 2

There have been no new developments for Track 2 since the IAASB’s December meeting. At that time, the IAASB discussed:

  • Adopting the objective in paragraph 400.8 of the IESBA Code, which supports the purpose for establishing differential requirements for PIEs.
  • Extending the differential requirements in the ISQMs and ISAs for listed entities to apply to PIEs. The IAASB agreed to propose extending the differential requirements, with the exception of those in ISA 720 (Revised), The Auditor’s Responsibilities Relating to Other Information.
  • Adopting the IESBA definitions of PIE and “publicly traded entity” in the ISQMs and ISAs.
  • Incorporating a central list of factors and examples in ISQM 1, Quality Management for Firms that Perform Audits or Reviews of Financial Statements or Other Assurance or Related Services Engagements, and ISA 200, Overall Objectives of the Independent Auditor and the Conduct of an Audit in Accordance with International Standards on Auditing. The factors and examples would be:
    • Used to guide a firm or auditor in determining whether it is appropriate to apply differential requirements applicable to PIEs to entities other than PIEs.
    • Relevant to all differential requirements across the ISQMs and ISAs, to support consistency in application and judgment.

For further information, visit the Listed Entities and PIE project page


Sustainability Assurance

Updated April 2023

The IAASB is developing a new overarching standard for sustainability assurance engagements, the proposed International Standard on Sustainability AssuranceTM (ISSA) 5000, General Requirements for Sustainability Assurance Engagements. Following the IAASB’s approval of a project proposal in September 2022, the IAASB continued the discussion at the December and March 2023 meetings. Specifically, the IAASB discussed draft requirements and application material for proposed ISSA 5000. Among the key matters discussed to date are: 

  • The scope of the standard and how it fits within the structure of the IAASB’s standards: The standard will be stand-alone from ISAE 3000 (Revised), Assurance Engagements Other Than Audits or Reviews of Historical Financial Information. It will be principles-based so that it is suitable across all sustainability topics, information disclosed about those topics, and reporting frameworks, and will address both limited and reasonable assurance. 
  • Key areas of focus in developing the standard: The standard will address the conduct of an assurance engagement in its entirety. However, the IAASB will specifically consider the requirements and application material for the following six priority areas difference in work effort between limited and reasonable assurance; suitability of reporting criteria; the scope of the engagement; obtaining and evaluating evidence; the entity's system of internal control; and materiality.
  • The structure of the proposed new overarching standard: The IAASB plans to develop a single standard that follows the flow of the engagement. 
  • Definitions: Development will include adapting definitions from existing IAASB terminology to sustainability assurance engagements. 
  • The approach to drafting the new standard: The standard will be developed using material adapted from existing IAASB standards and guidance, including ISAE 3000 (Revised), ISAE 3410, Assurance Engagements on Greenhouse Gas Statements, and the IAASB’s non-authoritative guidance on sustainability and other extended external reporting assurance engagements. Certain ISAs will also be considered, to the extent the material is relevant to sustainability assurance engagements, is appropriate for an overarching standard, and is at an appropriate degree of specificity. 

The next discussion will be at the April 2023 IAASB meeting when the introduction and illustrative assurance reports for proposed ISSA 5000 will be discussed. The entire proposed ISSA 5000 will be discussed at the June 2023 IAASB meeting. 

For further information, visit the Assurance on Sustainability Reporting project page.

Automated machines

Technology – Disruptive Technologies

Updated April 2023

The IAASB is taking an ongoing, dual approach to Technology matters:

  • Current and future workplan actions – Exploring how the IAASB can most effectively respond to technology via new or revised international standards or nonauthoritative guidance.
  • Impact of disruptive technologies – Exploring the effect on audit and assurance (in the current and future environments) in order to be prepared for technology disruption and able to respond appropriately to support audit and assurance quality.

The IAASB has released a number of resources, which are available on our technology focus area page. The IAASB meeting in March 2023 included updates on Disruptive Technology, as well as findings related to technology adoption and barriers to adoption from outreach. The IAASB provided their views and feedback, including suggested ways forward.

For further information, visit the Technology project page