FRC welcomes IAASBs proposals to transform auditor’s reports
News types: Consultation Announcement
Published: 1 August 2013
The IAASB’s proposals, published on July 25th, include a requirement for auditors of listed entities to communicate in the auditor’s report those matters that the auditor judges to have been of most significance in the audit of the financial statements.
Nick Land, a member of the Board of the FRC and Chairman of the FRC’s Audit and Assurance Council commented:
"We welcome the IAASB’s proposals for enhancing auditor reporting standards. We believe they are, in principle, consistent with the governance-led changes made by the FRC over the last year to audit committee and auditor reporting in the UK and Ireland.
The FRC’s approach combines reporting to users by the Board and auditors, reinforcing the responsibilities of the board and the auditor for reporting information that is primarily in their respective domains, whilst holding both to account for effective overall communication.
I would encourage all our stakeholders to engage in the debate about these proposals and how they should be integrated with the changes the FRC has already made and to assist us in developing our response to the IAASB’s consultation.”
Melanie McLaren FRC Executive Director, Codes and Standards added:
“The FRC is an active supporter of the work of the IAASB in seeking to establish globally applicable auditing standards. The UK was one of the first countries to adopt the ISAs as the basis for its national standards. The IAASB’s standards are developed in the knowledge that there are differences in governance practices internationally.
The IAASB’s proposals necessarily seek to address users’ concerns primarily through enhanced reporting by auditors. Importantly, they also recognise the need for modifications where national laws and regulations take a more holistic approach to governance, as in the case of the FRC’s recent changes.”
Notes to editors:
The FRC is responsible for promoting high quality corporate governance and reporting to foster investment. We set the UK Corporate Governance and Stewardship Codes as well as UK standards for accounting, auditing and actuarial work. We represent UK interests in international standard-setting. We also monitor and take action to promote the quality of corporate reporting and auditing. We operate independent disciplinary arrangements for accountants and actuaries; and oversee the regulatory activities of the accountancy and actuarial professional bodies.