The International Auditing and Assurance Standards Board (IAASB) on Feb. 4, 2019, published a consultation paper seeking comment on its proposed strategic direction and work plan.
Feedback on the Proposed Strategy for 2020-2023 and Work Plan for 2020-2021 is due by June 4, 2019.
“The evolving environment in which the IAASB operates demands a strategy that reflects, among others, changing technology; a dynamic small- and medium-sized entity landscape; and emerging reporting needs,” the board said in a statement.
The board said its proposed strategy puts a way forward that it believes meets the capital markets’ evolving needs. It said the strategy also promotes the public interest.
“Enhancing our processes, including using technology and appropriate resourcing, are included in the strategy and are crucial to success,” the IAASB said. “These enhancements will also maximize the impact of our activities, thereby enabling more timely responses to global trends and needs.”
The consultation paper says that the IAASB’s goal is to have “sustained public trust in financial and other reporting, enhanced by high-quality audits, assurance and related services engagements, through delivery of robust global standards that are capable of consistent and proper implementation.”
The proposed strategy said that the board will commit to engage, listen and learn, and to lead and adapt in its standard-setting responsibilities, among other things.
The consultation paper also describes several actions it would take to achieve its strategy, including completion of major audit quality enhancements.
The standard-setter said it also wants comments on whether there are any other topics that should be considered.
The Work Plan highlights the board’s effort to complete significant projects currently underway. The document also focuses on identifying new issues that may affect the IAASB’s standards and timely analysis and resolution of those issues.
IAASB Chairman Arnold Schilder said the board has already identified two new initiatives: one dealing with audits of less complex entities and the other on audit evidence, including how changes in the use of technology affect the gathering and evaluation of audit evidence.
“We will begin with research for both of these projects to provide important input to help us determine, with an open mind, the most appropriate actions to address the challenges,” Schilder wrote in the foreword of the consultation paper. “In the meantime, we will continue to think more about what can be done in the short-term in relation to automated tools and techniques, in particular those that are becoming more prevalent in our environment as technologies continue to evolve.”
The IAASB’s work on emerging technology comes as more companies and auditors use sophisticated tools for financial reporting and audit work.
In the U.S., the Public Company Accounting Oversight Board (PCAOB) has a research agenda to determine whether its audit standards need to be updated with increased use of technology and data analytics by auditors. The American Institute of Certified Public Accountants’ (AICPA) Auditing Standards Board (ASB) is also working on a project to update its guidance on audit evidence to better reflect the changing technological environment.
Separately, the Institute of Management Accountants (IMA)’s updated Management Accounting Competency Framework includes technology and analytics as one of six areas of expertise that finance and accounting professionals need to remain relevant in the digital age. The other five are: strategy, planning and performance; reporting and control; business acumen and operations; leadership; and professional ethics and values.
The IMA made the enhancements to its competency framework on Feb. 5, 2019.
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