At its June Board meeting, the International Ethics Standards Board for Accountants (IESBA) approved updates to its 2025-2026 Work Plan to better support ethical behavior and independent judgment in an increasingly volatile and uncertain environment.

Amid rapid shifts in financial markets, stakeholder expectations, and the regulatory landscape, the IESBA reaffirmed its commitment to strengthening the ethical foundations of accounting, business and finance.

“The current challenges require us to focus on what matters most: stronger ethical cultures, better support for global adoption of our standards, and a smarter, more responsive approach to our work,” said Gabriela Figueiredo Dias, IESBA Chair. “We’ve developed strong standards — now it’s time to focus on supporting their use in day-to-day decisions. The IESBA remains committed to helping professional accountants apply ethics in real-world contexts and to strengthening public trust where it’s needed most.”

The revised work plan reflects three key decisions:

1. A Resequenced Approach to the Firm Culture and Governance Project

Building on extensive stakeholder feedback and market analysis, IESBA remains firmly committed to taking decisive steps to address the cultural and governance dimensions at accounting firms that have implications for ethical behavior. Following up on the January 2025 landmark IESBA Firm Culture and Governance (FCG) Working Group Report, over the next 6 months the IESBA will develop a series of IESBA viewpoints on the eight elements of an FCG framework highlighted in the Working Group report, including ethical leadership, accountability, and incentives and rewards. At the same time, the IESBA will develop a plan for practical guidance and other initiatives in 2026 to help firms foster ethical culture and embed values that support long-term trust.

By mid-2026, informed by its further engagement with stakeholders on the viewpoints, the IESBA will consider the approach to the development of the FCG framework to guide firms’ cultural alignment and related governance practices, including consideration of the benefit of including the framework in the IESBA’s International Code of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code).

This resequenced approach reflects the IESBA’s leadership role in responding to ethical gaps in practice and strengthening public trust and confidence in the accountancy profession, while recognizing that the current volatile and uncertain context calls for increased support to market participants.  This recognition is also reflected in the IESBA’s strategic decision to slow down the issuance of new standards, especially in light of the adoption and implementation efforts required for the significant ethics and independence standards recently issued, including on sustainability reporting and assurance, tax planning and related services, group audits, definition of a public interest entity, and technological transformations in the accounting, assurance and finance functions.

2. The Introduction of the SMART Strategic Framework

To enhance the clarity, impact, and coherence of its activities, the IESBA approved the SMART framework — a new stakeholder-centric strategic lens to guide its work, driving effective consistency and strategic alignment. SMART stands for:

• Simplification of processes and outputs;
• Mobilization of stakeholders to act with impact and purpose;
• Adoption support of the IESBA Code across jurisdictions;
• Responsiveness to stakeholders in the face of emerging risks and expectations; and
• Targeted Action by tailoring efforts and engagement to different stakeholders.

This framework translates the IESBA’s vision into an operational roadmap that will shape planning, communications, and coordination across projects.

3. Slowing the Pace of Standard-Setting: A Reinforced Focus on Stakeholder Engagement and on Adoption and Implementation

Recognizing that to be relevant and impactful, robust standards require real-world application to drive change, the IESBA is stepping up its support for jurisdictions and professionals adopting and implementing the Code. Therefore, the IESBA is slowing the pace of new standards to allow consolidation of recently issued standards, with no new significant standards to be issued before 2027. The updated plan places increased emphasis on:

• Tailored stakeholder outreach and engagement
• Dedicated mechanisms to address challenges in the implementation of the Code
• Post-implementation reviews of significant recent standards
• Development of non-authoritative and other supporting materials and initiatives to aid implementation and application of standards issued over the last few years
• Coordination with IFAC and other global bodies as well as jurisdictional standard setters to address adoption barriers and increase support for the adoption and implementation of the IESBA Code

The updated IESBA Work Plan 2025-2026 can be accessed here.

About IESBA
The International Ethics Standards Board for Accountants (IESBA) is an independent global standard-setting board. The IESBA’s mission is to serve the public interest by setting high-quality, international ethics (including independence) standards as a cornerstone to ethical behavior in business and organizations, and to public trust in financial and non-financial information that is fundamental to the proper functioning and sustainability of organizations, financial markets and economies worldwide.

Along with the International Auditing and Assurance Standards Board (IAASB), the IESBA is part of the International Foundation for Ethics and Audit (IFEA). The Public Interest Oversight Board (PIOB) oversees IESBA and IAASB activities and the public interest responsiveness of the standards.

The International Auditing and Assurance Standards Board (IAASB) has published a new Frequently Asked Questions document for the International Standard on Auditing for Audits of Financial Statements of Less Complex Entities (ISA for LCE), its standard tailored for financial audits of smaller and less complex entities. This new FAQ addresses common questions received during webinars and outreach following the standard’s publication in December 2023, offering timely and practical clarifications. It also replaces a previously issued FAQ.

This release represents the final planned component of the IAASB’s implementation support package for the ISA for LCE, complementing the previously released adoption guide, fact sheet, first-time implementation guide, and other supplemental materials. Together, these resources provide a comprehensive suite of tools to support effective implementation.

The IAASB remains committed to supporting the adoption and implementation of the ISA for LCE through continued outreach and engagement with stakeholders, as well as with global and jurisdictional regulators.

While the FAQ does not amend or override the authoritative text of the ISA for LCE, it serves as a helpful tool to support consistent understanding and application of the standard.

Explore the guide and additional resources at: www.iaasb.org/ISAforLCE.

About the ISA for LCE
Built on the foundation of the International Standards on Auditing (ISAs), the International Standard on Auditing for Audits of Financial Statements of Less Complex Entities, or the ISA for LCE, is proportionate and tailored to the specific needs of audits of less complex entities. Its streamlined approach enhances usability for practitioners performing these engagements.

About IAASB
The International Auditing and Assurance Standards Board develops auditing, assurance, related services, and quality management standards and guidance in the public interest that support consistent performance of quality engagements. Along with the International Ethics Standards Board for Accountants, the IAASB is part of the International Foundation for Ethics and Audit. The Public Interest Oversight Board oversees IAASB and IESBA activities and the public interest responsiveness of the standards. For copyright, trademark, and permissions information, please visit Permissions.

This FAQ addresses common questions received during webinars and outreach following the ISA for LCE's publication in December 2023, offering timely and practical clarifications. It also replaces a previously issued FAQ.

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