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This summary of decisions of the Auditing and Assurance Standards Board (AASB) has been prepared for information purposes only. Decisions reported are tentative and reflect only the current status of discussions on projects, which might change after further deliberations by the AASB. Decisions to publish exposure draft and Handbook material are final only after a formal ballot process.
For more detailed information about AASB projects, please refer to the project summaries under Projects. |
Canadian-Specific Projects Agreed-upon Procedures Regarding Internal Control over Financial Reporting
The AASB reviewed and approved final Handbook material. The AASB also agreed to develop a Canadian standard for audits of internal control over financial reporting based on the Public Company Accounting Oversight Board’s proposal to revise Auditing Standard No. 2. Compilation Engagements
The AASB reviewed and approved final Handbook material. The AASB agreed that the revisions would apply to Notice to Reader communications dated on or after July 1, 2007, with earlier adoption permitted. New CICA Handbook – Assurance — Clarification
The AASB approved a project proposal to retain and clarify, in the new CICA Handbook – Assurance (new Handbook), certain financial statement auditing standards for which there are no equivalents in the International Standards on Auditing (ISAs). This project will include the development of criteria to be applied when making retention decisions regarding such standards and related guidelines. The AASB also discussed issues related to the content in the new Handbook that is outside the scope of the AASB’s project to adopt ISAs, and agreed to changes to the structure of the current Handbook, including revisions to numbering of non-auditing Sections, for the new Handbook. Going Concern
The AASB agreed to discontinue its project to develop a unique Canadian standard dealing with the auditor’s responsibilities regarding going concern uncertainties when auditing an entity’s financial statements that have been prepared using the going concern assumption. Later this year, the AASB expects to issue an exposure draft to adopt clarified ISA 570, Going Concern, that is currently being developed by the International Auditing and Assurance Standards Board (IAASB). Small and Medium-Sized Practices (SMPs)
The AASB discussed issues related to more effectively obtaining input from practitioners with SMPs. Projects Related to the Adoption of International Standards on Auditing The AASB reviewed and approved the following new Handbook material:
| — | CAS 240, The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements | | — | CAS 300, Planning an Audit of Financial Statements | | — | CAS 315, Identifying and Assessing the Risks of Material Misstatement Through Understanding the Entity and Its Environment | | — | CAS 330, The Auditor’s Responses to Assessed Risks. |
The earliest effective date of these standards will be for periods beginning on or after December 15, 2008.
The AASB reviewed and discussed a preliminary draft of an exposure draft of a proposed Canadian Auditing Standard that is based on the IAASB Exposure Draft that proposes to redraft in clarity format, but not otherwise revise, ISA 500, Audit Evidence. The AASB reviewed and discussed a preliminary draft of an exposure draft of a proposed Canadian Auditing Standard that is based on proposed revisions to ISA 550, Related Parties. The AASB discussed issues relating to the following IAASB projects:
| — | ISA 220, Quality Control for Audits of Historical Financial Statements and ISQC 1, Quality Control for Firms that Perform Audits and Reviews of Historical Financial Information, and Other Assurance and Related Services Engagements | | — | ISA 250, Consideration of Laws and Regulations in an Audit of Financial Statements | | — | ISA 505, External Confirmations | | — | ISA 530, Audit Sampling and Other Means of Testing | | — | ISA 700, The Independent Auditor’s Report on a Complete Set of General Purpose Financial Statements | | — | ISA 705, Modifications to the Opinion in the Independent Auditor’s Report and ISA 706, Emphasis of Matter and Other Matter(s) Paragraphs in the Independent Auditor’s Report | | — | ISA 800, The Independent Auditor’s Report on Summary Audited Financial Statements | | — | Preface to the International Standards on Quality Control, Auditing, Review, Other Assurance and Related Services |
The AASB also reviewed and approved Project Strategy Documents to develop Canadian Auditing Standards equivalent to ISAs 250, 500 and 530.
The AASB reviewed and discussed comments received on its Exposure Drafts of proposed Canadian Auditing Standards and drafts of its letters in response to the IAASB Exposure Drafts revising the following ISAs:
| — | ISA 260, Communication with Those Charged with Governance | | — | ISA 320, Materiality in Planning and Performing an Audit and ISA 450, Evaluation of Misstatements Identified During the Audit |
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