Audit reporting set for changes following new IAASB standards

This week Mazars looks at the sweeping, worldwide changes to auditor reporting following the introduction of new standards from the IAASB (International Auditing and Assurance Standards Board)

IAASB aiming to make audit reports more visible than ever

Mazars understands the true value that thorough and objective audit and assurance services can bring to a company. Its specialist teams provide a full range of audit, reporting, actuarial, corporate governance, risk management and transaction support services.

The aim of the latest IAASB standards is to evolve auditor reports so they clearly communicate key audit matters to investors and other stakeholders.

What do the changes mean?

Crucial features of the International Auditing and Assurance Standards Board’s changes to auditor reporting include:

  • Auditors’ work and their ability to communicate on complex issues will be more visible than ever
  • Highlight the softness and uncertainty that increasingly permeate financial reporting.
  • Auditor commentary on key audit matters – those matters that in the auditor’s judgement were of most significance in the audit as a subset of the matters reported to the audit committee or board.
  • Re-ordering of the audit report to provide the auditor’s opinion up front.
  • Revised descriptions of responsibilities and wording in key areas such as going concern paragraphs.

Subject to adoption by national standard setters, the changes are expected to apply at the earliest in 2017 in most jurisdictions.

Similar practices already in place in the UK

The Financial Reporting Council (FRC) in the United Kingdom has already introduced a similar revised auditor reporting model. The UK’s experience shows, in the main, a positive effect to the changes. Auditors have gained a deeper understanding into the client’s business and the professional scepticism applied to key judgements.

Mazars understands Auditing

The underlying value of audit is a means of maintaining the credibility of the business and, for listed companies, the sustainability of its share price value over the long-term. For an owner-manager, a professionally conducted audit is a vital business control and can be offered as part of Mazars’ overall OMB business advisory approach.

Mazars’ cares about its industry. They have long pressed for a debate on audit competition. They believe that companies and their shareholders alike deserve the benefits that increased competition can bring and are committed to playing an active role in shaping its future.

www.mazars.co.uk

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