The APB Issues Revised Guidance on the Audit of Financial Statements of Public Sector Bodies in the United Kingdom
News types: Guidance
Published: 5 October 2010
The Auditing Practices Board (APB) of the FRC has today issued revised guidance (PDF) for auditors on the application of auditing standards in the audit of financial statements of public sector bodies in the United Kingdom.
The APB has taken into consideration the comments received on the Consultation Draft. In particular it has clarified the responsibilities of the auditor where, for certain public sector bodies, the opinion on the financial statements can be given before the auditor has discharged their other statutory duties and issued an ‘audit completion certificate.’
Richard Fleck, Chairman of the APB and a director of the FRC said,
“The APB is updating its Practice Notes to assist the application of the new auditing standards that were issued in October 2009. The APB hopes that auditors of public sector bodies will find the revised and clarified guidance helpful in carrying out their work.”
Notes to Editors
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The Financial Reporting Council (FRC) is the UK’s independent regulator responsible for promoting high quality corporate governance and reporting to foster investment. Its functions are exercised principally by its operating bodies (the Accounting Standards Board, the Auditing Practices Board, the Board for Actuarial Standards, the Financial Reporting Review Panel, the Professional Oversight Board and the Accountancy and Actuarial Discipline Board) and by the FRC Board. The Committee on Corporate Governance assists the Board in its work on corporate governance.
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The APB is committed to leading the development of auditing practice
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to establish high standards of auditing;
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to meet the developing needs of users of financial information; and
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to ensure public confidence in auditing.
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In October 2009 the APB issued a new suite of International Standards on Auditing (ISAs) (UK and Ireland) that are effective for audits of accounting periods ending on or after 15 December 2010.
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The APB issues Practice Notes to assist auditors in applying auditing standards of general application to particular circumstances and industries. Practice Notes are persuasive rather than prescriptive. However, they are indicative of good practice.
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The standards governing the conduct of an audit of financial statements in the public sector are a matter for the national audit agencies and certain regulators to determine. However, the heads of the national audit agencies in the UK have chosen to adopt the PB’s engagement standards and quality control standards as the basis of their approach to the audit of financial statements.
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The revision of Practice Note 10 primarily provides guidance for auditors on their audit procedures when applying the new ISAs (UK and Ireland). It also takes account of a small number of legal and regulatory developments affecting public sector bodies in the United Kingdom since the current Practice Note 10 (Revised) was issued in January 2006. It also clarifies the responsibilities of the auditor where, for certain public sector bodies, the opinion on the financial statements can be given before the auditor completes discharging their other statutory duties and issues an ‘audit completion certificate.’
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Practice Note 10 (Revised) issued today has been prepared with advice and assistance from staff of the national audit agencies and auditors of public sector bodies.