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Technical new in brief December 2021- March 2022

ICAEW's Audit and Assurance Faculty brings you the latest technical updates on developments in auditing and assurance, financial reporting and ethics.

Embracing the UK Stewardship Code

Financial Reporting | 10 March 2022

The Financial Reporting Council (FRC) has published an updated list of signatories to the UK Stewardship Code, 105 applications were received with 74 being successful, taking the number of signatories to 199.

Independence expectations in group audits

Audit and Assurance | 1 March 2022

The International Ethics Standards Board for Accountants (IESBA) has released the Exposure Draft Proposed Revisions to the Code Relating to the Definition of Engagement Team and Group Audits. The deadline for comments is 31 May 2022.

New IFAC digital platform

Financial Reporting | 28 February 2022

The International Federation of Accountants (IFAC) has launched a new digital platform, Pathways to Accrual, to assist governments and public sector entities in transitioning from cash to accrual accounting.

Key audit partners for local audit

Audit and Assurance | 28 February 2022

The Financial Reporting Council (FRC) has issued a consultation on proposed changes to its statutory Guidance to the Recognised Supervisory Bodies (RSBs) on the recognition of Key Audit Partners for local audit, in response to the 2019 Redmond Review. The deadline for comments is 28 March 2022.

Embracing the Wates Principles

Financial Reporting | 23 February 2022

The Financial Reporting Council (FRC) has issued an in-depth assessment of the quality of reporting from private companies choosing to follow the Wates Principles.

Technology-related revisions to the Code

Ethics | 18 February 2022

The International Ethics Standards Board for Accountants (IESBA) has released the Exposure Draft Proposed Technology-related Revisions to the Code, to enhance the Code’s robustness and relevance given the rapid advancements in technology. The deadline for comments is 20 June 2022.

New quality management implementation guide

Audit and Assurance | 17 February 2022

The International Auditing and Assurance Standards Board (IAASB) has released the First-time Implementation Guide for ISA 220, Quality Management for an Audit of Financial Statements, to help stakeholders understand and implement the requirements of the standard.

IFRS Accounting Taxonomy Update

Financial Reporting | 15 February 2022

The International Accounting Standards Board (IASB) has issued an update to the IFRS Accounting Taxonomy 2021 for Disclosure of Accounting Policies and Definition of Accounting Estimates.

Auditor climate reporting responsibilities under ISA (UK) 720

Audit and Assurance | 14 February 2022

The Financial Reporting Council (FRC) has published a new FRC Staff Guidance, Auditor responsibilities under ISA (UK) 720 in respect of climate related reporting by companies required by the Financial Conduct Authority.

Sustainability reporting

Financial Reporting | 9 February 2022

The Financial Reporting Council (FRC) has outlined its initial thoughts to the International Sustainability Standards Board (ISSB) on the sustainability disclosure prototypes published by the Technical Readiness Working Group.

IPSASB proposes limited scope updates to Conceptual Framework

Financial Reporting | 1 February 2022

The International Public Sector Accounting Standards Board (IPSASB) has released Exposure Draft 81, Conceptual Framework Update: Chapter 3, Qualitative Characteristics and Chapter 5, Elements in Financial Statements. The deadline for comments is 31 May 2022.

Consolidation of Climate Disclosure Standards Board

Financial Reporting | 31 January 2022

The International Financial Reporting Standards (IFRS) Foundation has completed consolidation of the Climate Disclosure Standards Board (CDSB) from CDP as part of the commitment made to provide staff and resources to the new International Sustainability Standards Board (ISSB).

January 2022 editions of accounting standards

Financial Reporting | 31 January 2022

The Financial Reporting Council (FRC) has issued January 2022 editions of UK and Ireland accounting standards, reflecting amendments made since the previous editions issued in 2018 as well as changes in Irish company law. The FRC has also issued revised editions of the Foreword to Accounting Standards and Overview of the financial reporting framework.

IPSASB issues IPSAS 43 - Leases

Financial Reporting | 31 January 2022

The International Public Sector Accounting Standards Board (IPSASB) has issued International Public Sector Accounting Standard (IPSAS) 43, Leases. IPSAS 43 has an effective date of 1 January 2025 with earlier application permitted in certain circumstances.

FAQs on revised fee-related provisions of IESBA code

Ethics | 31 January 2022

The Staff of the International Ethics Standards Board for Accountants (IESBA) have released a set of FAQs on the recently revised fee-related provisions of The International Code of Ethics for Professional Accountants.

PCAOB to form two new advisory groups

Audit and Assurance | 31 January 2022

The Public Company Accounting Oversight Board (PCAOB) has announced the creation of two new advisory groups – the Investor Advisory Group (IAG) and the Standards and Emerging Issues Advisory Group (SEIAG) to enhance engagement with investors and other stakeholders. The deadline for comments and nominations for those seeking to participate in the groups is 28 February 2022.

Audit Committee Chairs research

Audit and Assurance | 26 January 2022

The Financial Reporting Council (FRC) has published new research conducted by YouGov on Audit Committee Chairs’ views on, and approach to, audit quality.

Improvements to IPSAS 2021

Financial Reporting | 24 January 2022

The International Public Sector Accounting Standards Board (IPSASB) has issued Improvements to IPSAS, 2021, which includes minor improvements to address issues raised by stakeholders and minor amendments from recent IFRS improvements and narrow scope projects.

Conforming and consequential amendments to IAASB standards

Audit and Assurance | 19 January 2022

The International Auditing and Assurance Standards Board (IAASB) has released further conforming and consequential amendments to the IAASB’s standards resulting from the new and revised quality management standards. The conforming amendments to the IAASB’s International Standards are effective as of 15 December 2022.

FRC three-year plan

Financial Reporting | 18 January 2022

The Financial Reporting Council (FRC) has published its three-year plan and budget for transition to the Audit, Reporting and Governance Authority (ARGA). The deadline for the 2022/23 Strategy and Plan & Budget consultation is 1 March 2022.

IAASB 2022-2023 Work Plan

Audit and Assurance | 11 January 2022

The International Auditing and Assurance Standards Board (IAASB) has approved a new work plan entitled ‘A Public Interest Focus in Uncertain Times’, with sustainability and environmental, social and governance (ESG) assurance as a prominent addition to the plan. The plan is pending approval by the Public Interest Oversight Board (PIOB) in April 2022.

Technology is a double-edged sword

Financial Reporting | 20 December 2021

The Chartered Professional Accountants of Canada (CPA Canada), the Institute of Chartered Accountants of Scotland (ICAS), the International Ethics Standard Board for Accountants (IESBA) and the International Federation of Accountants (IFAC) have released their second publication in a four-part thought leadership series examining the professional accountant’s role in a new technological era.

PCAOB Staff Guidance update

Financial Reporting | 17 December 2021

The Public Company Accounting Oversight Board (PCAOB) has released updates to its staff guidance on Form AP, Auditor Reporting of Certain Audit Participants, in light of the COVID-19 pandemic.

FRC summary of recent reviews

Financial Reporting |17 December 2021

The Financial Reporting Council (FRC) has published the latest list of companies whose reports and accounts have been reviewed by its Corporate Reporting Review function.

PCAOB HFCAA determination report

Financial Reporting |16 December 2021

The Public Company Accounting Oversight Board (PCAOB) has issued a Holding Foreign Companies Accountable Act (HFCAA) determination report regarding PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong.

Proposed update to Initial Application of IFRS 17 and IFRS 9

Financial Reporting |16 December 2021

The International Financial Reporting Standards (IFRS) Foundation has published Proposed Update 3 Initial Application of IFRS 17 and IFRS 9 – Comparative Information (Amendment to IFRS 17). The deadline for comments is 17 January 2022.

Technical Readiness Working Group

Financial Reporting | 14 December 2021

The International Financial Reporting Standards (IFRS) Foundation has released a webcast explaining the recommendations for consideration from the Technical Readiness Working Group (TRWG) to the International Sustainability Standards Board (ISSB).

Transition option to insurers applying IFRS 17

Financial Reporting | 9 December 2021

The International Accounting Standards Board (IASB) has issued a narrow-scope amendment to the transition requirements in IFRS 17 Insurance Contracts. IFRS 17 is effective for annual reporting periods starting on or after 1 January 2023.

The need for positive corporate culture

Financial Reporting | 9 December 2021

The Financial Reporting Council (FRC) has issued a new report entitled Creating positive culture – opportunities and challenges, emphasising the importance of aligning culture with purpose, values and strategy.

Planning an audit using automated tools and techniques

Audit and Assurance | 7 December 2021

The International Auditing and Assurance Standards Board (IAASB) has released frequently asked questions on audit planning to help auditors understand how to plan an audit under ISA 300 when using automated tools and techniques.

Annual review of FRS 101

Financial Reporting | 7 December 2021

The Financial Reporting Council (FRC) has issued Financial Reporting Exposure Draft 79 FRS 101 Reduced Disclosure Framework – 2021/22 cycle, which proposes no amendments to FRS 101 following its latest annual review. The deadline for comments is 1 March 2022.

Audit Enforcement Procedure feedback statement

Audit and Assurance | 7 December 2021

The Financial Reporting Council (FRC) has published a revised Audit Enforcement Procedure (AEP) and feedback statement following a consultation on proposed amendments. The revised AEP came into force on 5 January 2022.

Assurance of sustainability information

Audit and Assurance | 6 December 2021

The International Federation of Accountants (IFAC) has published its vision for high-quality assurance of sustainability information, identifying emerging best practices.

FRC areas of supervisory focus 2022/23

Audit and Assurance | 3 December 2021
The Financial Reporting Council (FRC) has announced its areas of supervisory focus for 2022/23, including priority sectors, for corporate reporting reviews and audit quality inspections

Audit firm culture – a collection of perspectives

Audit and Assurance | 2 December 2021
The Financial Reporting Council (FRC) has published a Collection of Perspectives following on from the FRC Culture Conference held in June 2021.

IFRS Taxonomy 2021 proposed update

Financial Reporting | 2 December 2021
The International Financial Reporting Standards Foundation (IFRS Foundation) has published IFRS Taxonomy 2021 – Proposed Update 2 Technology Update. The proposed changes aim to reflect developments in the technology that underlies or relates to the IFRS Taxonomy. The deadline for comments is 3 January 2022.

FRC encouraged by Stewardship reporting

Financial Reporting | 1 December 2021
The Financial Reporting Council (FRC) has published a report entitled Effective Stewardship Reporting: Examples from 2021 and expectations from 2022, which analyses reports from the first signatories to the revised Code published in September 2021. The report highlights areas of high-quality disclosures, areas where there is still room for improvement and key areas of focus for the future.