Long Association Post-Implementation Review (LAPIR) – Phase 1
The Long Association Post-Implementation Review (LAPIR) is to be carried out in two phases:
This phase will review the implementation status of the five-year cooling-off requirement for EPs on audits of PIEs, and any issues arising from the implementation of such requirement before the expiry of the transition period for the jurisdictional provision.
Due to commence in Q2 2023, this phase will review how effectively the other revised long association provisions in the Code are being implemented in practice, taking into account legislative or regulatory developments relating to other regimes around the world intended to address long association, such as mandatory firm rotation (MFR) and mandatory retendering (MRT). To achieve synergies, the LAPIR Phase 2 will be undertaken in conjunction with the post-implementation review of the restructured Code.
- Richard Fleck, Chair, ex-IESBA Deputy Chair
- Saadiya Adam, IESBA Member
- Sung-Nam Kim, IESBA Member
- Kristen Wydell, IESBA Technical Advisor
IESBA March 2021 Meeting Highlights
The IESBA received its first update from the Long Association Post-Implementation Review (LAPIR) Working Group. The IESBA’s Strategy and Work Plan 2019-2023 sets out two phases of the LAPIR. Phase 1 began in Q1 2021 and will review the implementation status of the five-year cooling-off requirement for engagement partners on audits of PIEs, and any potential challenges from the expiry of the “jurisdictional provision” for audits of financial statements for periods beginning on or after December 15, 2023. Phase 2 will commence in Q2 2023 and will review how effectively the other revised long association provisions in the Code have been implemented in practice, taking into account developments in regulatory regimes around the world addressing long association.
The IESBA provided input to the Working Group’s proposed scope of, and approach to, Phase 1. This phase will focus on the use of the jurisdictional provision and how jurisdictions will transition to the five-year cooling-off requirement for engagement partners with respect to PIE audits. To inform its work, the Working Group released a questionnaire in April 2021 seeking input from stakeholders and will undertake targeted outreach activities between April-September 2021 with global, regional and local stakeholders.
The IESBA will receive an update at its June 2021 meeting.