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Responsibilities Relating to Other Information
| The summary of Auditing and Assurance Standards Board (AASB) projects has been prepared for information purposes only. Decisions reported are tentative and reflect only the current status of discussions on this project, which may change after further deliberations by the AASB. Decisions to publish Handbook material are final only after a formal voting process. |
Status: Monitoring the IAASB’s activities regarding proposed revisions to ISA 720.
Objective and Scope of this Project
Background
Issues
Activities to Date
Next Steps
Contact Information
Objective and Scope of this Project
The objective of this project is to revise Canadian Auditing Standard (CAS) 720, The Auditor’s Responsibilities Relating to Other Information in Documents Containing Audited Financial Statements, to enhance requirements and guidance on the auditor’s responsibilities relating to other information in documents containing financial statements, when this information may affect the audit of those financial statements.
The extant International Standard on Auditing (ISA) 720, The Auditor’s Responsibilities Relating to Other Information in Documents Containing Audited Financial Statements, was last revised in 1993. As part of the IAASB’s Clarity project, this ISA was redrafted for conformity with the Clarity drafting conventions. The IAASB issued ISA 720 (Redrafted) in September 2007. The AASB adopted ISA 720 (Redrafted) as CAS 720 effective for all financial statements audits for periods ending on or after December 14, 2010.
The AASB is committed to adopting the ISAs. Accordingly, revisions that the IAASB makes to ISA 720 will be reflected in CAS 720. Amendments, if any, that the AASB would make to the ISA wording would be in accordance with the AASB’s criteria for such amendments, as set out in Appendix 1 of the Preface to the CICA Handbook – Assurance.
At each stage of review of the IAASB material, the AASB provides input to the IAASB member nominated by the CICA regarding the international standard on auditing project for discussion at the upcoming IAASB meeting.
During the clarity redrafting of the extant ISA 720, a number of respondents drew the IAASB’s attention to the need to revise this ISA to ensure that it is sufficient and fit for purpose in the context of today’s financial reporting environment. The IAASB approved a project proposal to revise ISA 720 at its December 2009 meeting.
- Key matters to be addressed by the ISA 720 revision project include the following:
- Whether the current definition of "other information" in the ISA is adequate in the current environment or whether, in the context of the range of other information being presented concurrently with audited financial statements, a different definition would be appropriate.
- The nature and extent of the auditor's responsibilities in connection with the other information including consideration of whether such responsibilities should remain directed at reading other information for material inconsistencies and material misstatements of fact, or whether it is appropriate to extend the responsibilities of the auditor.
- Implications of electronic dissemination of audited financial statements and the auditor's report.
- Whether and to what extent specific guidance should be included on the statutory and contractual requirements in some jurisdictions of auditors of public sector entities in relation to non-financial information.
Further information on the IAASB’s project is available on the IAASB project summary.
In September 2011, the AASB discussed matters related to the IAASB’s proposed exposure draft of revised ISA 720, The Auditor’s Responsibilities Relating to Other Information in Documents Containing or Accompanying Audited Financial Statements and the Auditor’s Report Thereon.
In March 2011, the AASB discussed matters related to the IAASB’s proposed exposure draft of revised ISA 720.
In September 2010, the AASB reviewed the IAASB issues paper pertaining to the revision of International Standard on Auditing (ISA) 720.
In March 2010, the AASB reviewed analyses of issues pertaining to the revision of ISA 720.
In December 2009, the AASB reviewed the project proposal to revise ISA 720.
IAASB’s Discussions to Date
Background papers that are the basis of the IAASB’s discussions, along with meeting summaries and audio recordings of the actual discussions, can be accessed on the IAASB’s website by clicking here and then on the date of the meeting at which matters pertaining to a project were discussed.
The following summarizes the AASB’s planned activities:
| Meeting Date | Activity |
| November 2011 | The AASB to review analyses of issues pertaining to revised ISA 720. |
| March 2012 | The AASB to review analyses of issues pertaining to the third draft of revised ISA 720. |
| April 2012 | The AASB to issue an exposure draft of revisions to CAS 720. |
The AASB’s planned activities beyond this point are dependent on the IAASB’s timing of the project, which has not yet been finalized.
Contact Information
Staff contact: Chi Ho Ng, CA
Telephone no.: +1 (416) 204 3443