The International Ethics Standards Board for Accountants (IESBA or the Board) posted a podcast that provides highlights of the December 3 – 6, 2019 meeting. Highlights were as follows:
Nonassurance Services. The Board agreed to issue an Exposure Draft (ED) that proposes changes to the independence rules for nonassurance services in the International Code of Ethics for Professional Accountants (including International Independence Standards) (“IESBA Code”). The Board will publish the ED in January 2020, which will be open for comment until early May 2020. The Board will discuss feedback received on the ED at its June meeting and will also host webinars during the comment period to enhance understanding of the proposed changes.
Fees. The Board agreed to issue an ED on proposed changes to the IESBA Code related to fees paid to the auditor. The ED will be issued in early 2020 and open for a 90-day comment period and builds on current provisions in the Code. Greater transparency of fees and communications with those charged with governance are key elements in the ED. The Board anticipates reviewing feedback from this ED at its June 2020 meeting.
Technology Working Group. The Working Group will issue its final report in the first quarter of 2020, completing Phase 1 of the project, which focused on whether the IESBA Code sufficiently addresses the use of artificial intelligence, big data and data analytics by professional accountants. That report concluded that at a principles level, the Code does address these issues. However, the Working Group recommended that the Code be modernized and supplemented with additional guidance.
New Task Forces. The Board created two (2) new task forces – one will address the implications of technology on the IESBA Code per the Technology Working Group’s recommendation and another will work with the International Auditing and Assurance Board (IAASB) to address the subject of group audits.
IESBA/IAASB Collaboration. Various projects were discussed. The Board unanimously approved a project proposal and an ED to address the objectivity of an engagement quality reviewer to support the development of the IAASB’s ISQM 2 standard. The ED will be released by the end of January 2020 and be open for a 45-day comment period.
Collaboration with the International Federation of Accountants (IFAC). The Board discussed the adoption and implementation of the IESBA Code and support that can come from IFAC and its members.
Reports regarding Independence Findings. Discussed reports from regulatory bodies from the International Forum of Independent Audit Regulators (IFIAR) and the UK Financial Reporting Council (FRC).
The Board’s next meeting will be in New York City on March 16 – 20, 2020.