ISA 540 Revision Project Publication
Mar 02, 2016 | Guidance & Support Tools
All available Translations: Japanese
This IAASB publication was developed by a task force comprised of IAASB members and technical advisors, representatives from the Basel Committee on Banking Supervision, the International Association of Insurance Supervisors, bank auditors, and an observer from the US Public Company Accounting Oversight Board.
It highlights the audit issues arising from the shift to Expected Credit Loss (ECL) models when accounting for loan losses. ECL models are now required, or will soon be required, by some financial reporting frameworks, including IFRS 9, Financial Instruments, which will come into effect from January 1, 2018.
Additionally, it summarizes the audit challenges identified with respect to ECL and sets out initial thinking on how these challenges may be addressed under the current International Standards on Auditing™ (ISA™).
A Project Proposal covering the broader project to revise ISA 540 has also been made available.
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