The International Ethics Standards Board for Accountants (IESBA) today released the 2023 Handbook of the International Code of Ethics for Professional Accountants (including International Independence Standards). This handbook replaces the 2022 edition and incorporates the following revisions:

• The revisions relating to (a) the definition of engagement team, and (b) group audits. The revisions deal with the independence and other implications of the changes made to the definition of “engagement team” in the Code to align with changes to the definition of the same term in the IAASB’s International Standards on Auditing (ISAs) and International Standards on Quality Management (ISQMs). The revisions also address holistically the various independence considerations in an audit of group financial statements. The revised provisions relating to the definition of engagement team and group audits will be effective for audits of financial statements and audits of group financial statements for periods beginning on or after December 15, 2023. Early adoption of the revisions is encouraged.
• The upcoming expiry of the “jurisdictional provision” addressing long association of personnel with an audit client.  The jurisdictional provision will expire and be no longer available for audits of financial statements for periods beginning on or after December 15, 2023. Under the jurisdictional provision (paragraph R540.20 of the Code), where a legislative or regulatory body (or organization authorized or recognized by such legislative or regulatory body) has established a cooling-off period for an engagement partner of less than five consecutive years, that shorter cooling-off period may be applied, subject to a floor of three years, provided that the applicable time-on period does not exceed seven years.

The back of the 2023 Handbook contains the IESBA-approved revisions to the Code, which are not yet effective. These revisions will become effective in December 2024 and include:

• Revisions to the definition of a public interest entity (PIE).
• Changes to the definitions of “audit client” and “group audit client” in the Glossary arising from the approved revisions to the definitions of listed entity and PIE.
• The technology-related revisions.

Click here to learn more about the IESBA Code.

Reproducing and Translating the IESBA Handbook
To help adoption and implementation of the IESBA standards, stakeholders are invited to submit requests for permission to reproduce or translate the IESBA Handbook online via the Online Permissions Requests or Inquiries system on the IFAC website.

The International Ethics Standards Board for Accountants (IESBA) is an independent global standard-setting board. The IESBA’s mission is to serve the public interest by setting high-quality, international ethics (including independence) standards as a cornerstone to ethical behavior in business and organizations, and to public trust in financial and non-financial information that is fundamental to the proper functioning and sustainability of organizations, financial markets and economies worldwide.

Along with the International Auditing and Assurance Standards Board, the IESBA is part of the International Foundation for Ethics and Audit. The Public Interest Oversight Board (PIOB) oversees IESBA and IAASB activities and the public interest responsiveness of the standards. 

This 2023 edition contains recently approved revisions to the Code, including:

The International Ethics Standards Board for Accountants (IESBA) today released its 2022 Annual Report, Reinforcing Ethics and the Public Interest in a Rapidly Evolving World.

The digitally interactive report looks back at 2022 through the eyes of the international ethics standard-setting board, complete with detailed reports on the Board’s projects alongside reflective remarks from its leaders. The report showcases a board in transition, completing long-running projects aimed at further strengthening the IESBA’s International Code of Ethics for Professional Accountants (including International Independence Standards) (the Code), addressing the ethical implications of rapid technological advances, and moving fast to develop the necessary ethics and independence standards for sustainability reporting and assurance, always working to serve the public interest.

“IESBA’s work in 2022 will ultimately strengthen the public’s trust in the professional accountant, corporate reporting and businesses more generally at a time of rapid change and complexity,” said IESBA Chair Gabriela Figueiredo Dias. “Collectively, we’ve ensured the necessary strategic adjustments to better serve the public interest in a context of complex developments that we face today, like sustainability and technology, through our actions to enhance our global ethics and independence standards, thereby raising the bar for ethical conduct and practice for all professional accountants and other service providers that may want to use our standards.”

Beyond the updates on IESBA projects, the 2022 IESBA Report features an overview of the Board’s extensive stakeholder outreach efforts and information about its efforts to promote global adoption and effective implementation of the Code. The Report also includes a message from the IESBA’s Consultative Advisory Group (CAG) Chair, Mr. Gaylen Hansen.

About IESBA

The International Ethics Standards Board for Accountants serves the public interest by setting high-quality ethics standards, including independence requirements, as a cornerstone to ethical behavior in business and organizations, and to public trust in financial and non-financial information that is fundamental to the proper functioning and sustainability of organizations, financial markets and economies worldwide.

Along with the International Auditing and Assurance Standards Board (IAASB), the IESBA is part of the International Foundation for Ethics and Audit (IFEA). The Public Interest Oversight Board (PIOB) oversees IESBA and IAASB activities and the public interest responsiveness of the standards. For copyright, trademark, and permissions information, please visit Permissions.

This digitally interactive report looks back at 2022 through the eyes of the IESBA, complete with detailed reports on the Board’s projects alongside reflective remarks from its leaders.

The International Auditing and Assurance Standards Board (IAASB) and the International Ethics Standards Board for Accountants (IESBA) applaud the efforts of the International Sustainability Standards Board (ISSB) and today’s International Organization of Securities Commissions’ (IOSCO) endorsement decision of the ISSB’s recently issued IFRS Sustainability Disclosure Standards S1 and S2. IOSCO determined that these standards are “appropriate to serve as a global framework for capital markets to develop the use of sustainability-related financial information in both capital raising and trading and for the purpose of helping globally integrated financial markets accurately assess relevant sustainability risks and opportunities.”

In commenting on the endorsement, Tom Seidenstein and Gabriela Figueiredo Dias, IAASB and IESBA Chairs, respectively, said, “IOSCO’s endorsement of IFRS Sustainability Disclosure Standards S1 and S2 and its call to action for member jurisdictions to move toward adoption and implementation are two more important steps in establishing a trusted reporting framework for sustainability information. We appreciate IOSCO’s leadership in coordinating global consistency in sustainability reporting, assurance and ethics standards.”