Proposed Revisions to the Definitions of Listed Entity and Public Interest Entity in the Code

IESBA
Jan 29, 2021 | Exposure Drafts and Consultation Papers
English

Comments due by: May 03, 2021

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This exposure draft proposes revisions to the International Code of Ethics for Professional Accountants (including International Independence Standards) that broadens the definition of a public interest entity (PIE). These revisions include more categories of entities, given the level of public interest in their financial condition, for the purposes of additional independence requirements to enhance confidence in their audits.

Among other matters, the proposed revisions:

  • Introduce an overarching objective for additional requirements to enhance confidence in the audit of financial statements of PIEs.
  • Provide guidance on factors to consider when determining the level of public interest in an entity.
  • Broaden the definition of PIE to additional categories of entities.
  • Replace the term “listed entity” with the term “publicly traded entity” and redefine that PIE category.
  • Introduce new requirements for firms to determine if additional entities should be treated as PIEs for independence purposes and to publicly disclose if an audit client was treated as a PIE.
  • Recognize and encourage local regulators to refine PIE categories in regard to national conditions.

Comments requested by May 3, 2021.

 

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