The International Auditing and Assurance Standards Board (IAASB) today proposed a significant strengthening of its standard on auditors’ responsibilities relating to fraud. Recent corporate failures throughout the world have underscored the benefits of clarifying and enhancing the role of auditors in responding to fraud and suspected fraud as a means of enhancing public trust in financial reporting.

IAASB Chair Tom Seidenstein emphasized that the proposed revisions define the expectations in relation to fraud, delineate more robust procedures, and increase transparency about the auditors’ responsibilities and fraud-related procedures in the auditor’s report. “While many participants in the financial reporting ecosystem, particularly management and those charged with governance, have a role in preventing fraud, our standard focuses on the key role that auditors play. While auditors are not policemen, they can and must play a role in identifying and responding to material misstatements of the financial statements due to fraud and communicating their work to users. This proposed standard is an important step forward,” said Mr. Seidenstein.

Key Changes in the Proposed Revisions
The proposed revisions to International Standard on Auditing 240 (Revised), The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements, include:

1. Clarified auditor responsibilities relating to fraud in an audit.
2. Emphasized professional skepticism to ensure auditors remain alert to possible fraud and exercise professional skepticism throughout an audit.
3. Strengthened identification and assessment of risks of material misstatement due to fraud.
4. Clarified response to fraud or suspected fraud identified during the audit.
5. Increased ongoing communication with management and those charged with governance about fraud.
6. Increased transparency about auditors’ responsibilities and fraud-related procedures in the auditor’s report.
7. Enhanced audit documentation requirements about fraud-related procedures.

Video Series Planned to Facilitate Understanding
During the consultation period, IAASB will release a videos series to help stakeholders understand the proposed revisions and their implications for strengthening the financial reporting ecosystem. Stay updated on upcoming events by following the IAASB on LinkedIn and/or X (formerly Twitter) and register/subscribe to our mailing list.

How to Provide Feedback
The IAASB invites all stakeholder to submit their comments using the Response Template, designed to facilitate a structured response and streamline feedback collation and analysis. Respondents are encouraged to share their insights by June 5, 2024.

About the IAASB
The International Auditing and Assurance Standards Board develops auditing, assurance, related services, and quality management standards and guidance in the public interest that support consistent performance of quality engagements. Along with the International Ethics Standards Board for Accountants, the IAASB is part of the International Foundation for Ethics and Audit. The Public Interest Oversight Board oversees IAASB and IESBA activities and the public interest responsiveness of the standards. For copyright, trademark, and permissions information, please visit Permissions.

The International Accreditation Forum (IAF) and the International Ethics Standards Board for Accountants (IESBA) today announced a strategic partnership to advance the use of a common framework of high standards of ethical conduct to underpin trust in the assurance of sustainability information.

After extensive engagement over the previous six months, the IAF and the IESBA have agreed to common objectives to support the growth of transparent, relevant, and trustworthy corporate sustainability disclosures. The cornerstone of the partnership is the IAF’s stipulation to national accreditation bodies around the world that the IESBA’s proposed International Ethics Standards for Sustainability Assurance (including International Independence Standards) (IESSA) are to be used when accrediting and authorizing conformity assessment bodies to carry out assurance work on corporate sustainability disclosures.¹ The IESBA recently launched the public consultation on the proposed IESSA and related standards, and is expected to finalize the standards by the end of the year.

Among the key elements of the agreement, both the IAF and the IESBA:

• Recognize the importance of having a global baseline of high-quality ethics (including independence) standards consistently applied by, and enforced on, all providers of assurance services on corporate sustainability disclosures, whether audit firms, conformity assessment bodies or others.
• Agree on the importance of establishing connections between the two organizations and to promote consistent use of a global framework of high-quality ethics standards for sustainability assurance.
• Will collaborate to determine how to incorporate the IESSA as part of the accredited verification activities of ISO/IEC 17029-compliant programs as they apply to assurance of sustainability information.
• Will share strategic insights and perspectives on their respective work as it relates to assurance of corporate sustainability disclosures.
• Will explore collaboration with respect to training activities for accreditation bodies and conformity assessment bodies in relation to the proposed IESSA.

Corporate sustainability disclosures provide stakeholders with vital insights into a company’s sustainability practices. Beyond compliance with evolving regulations and standards, sustainability disclosures offer companies a competitive advantage, attracting socially conscious investors, enhancing brand loyalty, and fostering resilience in the face of environmental and social risks. Assurance of these disclosures plays a crucial role in ensuring trust in reporting, particularly given the subjectivity, prospectivity and immaturity of the data underpinning the disclosures.

“Trustworthy sustainability disclosures are vital in demonstrating a company's commitment to sustainability practices,” said Emanuele Riva, IAF Chair. “Through this partnership, we strive to foster trust and confidence in sustainability reporting worldwide.”

Gabriela Figueiredo Dias, IESBA Chair, said: “A robust, global ethical framework, developed by the IESBA under public oversight and embraced by the IAF, will spur growth in the supply of sustainability assurance practitioners to meet the rapidly increasing market demand for high- quality sustainability information. I am proud of the IESBA and the IAF embarking on this exciting partnership together, which is undoubtedly in the public interest.”

¹when included in the ISO/IEC 17029 programme

#   #   #

About the International Accreditation Forum (IAF)

The IAF is a global association of accreditation bodies, conformity assessment body associations and other organizations involved in conformity assessment in fields including validation/verification and the certification of management systems, products, processes, services and persons.

The IAF promotes the worldwide acceptance of certificates of conformity and validation/verification statements issued by conformity assessment bodies accredited by IAF Multilateral Recognition Arrangement (MLA) signatories, and seeks to add value for all stakeholders through its activities and programs.

About the International Ethics Standards Board for Accountants (IESBA)

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 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 (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.

Professional accountants in business (PAIB) play a vital role within various sectors such as commerce, industry, financial services, education, and the public and non-profit sectors. IFAC’s PAIB Advisory Group, established in 1977, is a global forum of finance and business leaders advising the global accountancy profession and its members on critical areas such as sustainability and digital transitions so that PAIBs are well prepared to meet the evolving needs of both business and the public sector in the future.

The newest PAIB Advisory Group members are:

• Mike Driver, Past President, CIPFA & Independent Non-Executive Director (United Kingdom)
• Ruth Gardiner Forbes, President and CEO, Fortis TCI Ltd (Turks and Caicos Islands)
• Lisa Kelley, Managing Director, Floating Interest Corporation (United States of America)
• Josephine Okui Ossiya, CEO, Capital Markets Authority of Uganda (Uganda)
• Aniket Sunil Talati, Senior Partner, Management Consultancy Services and Advisory, Talati & Talati LLP (India)
• Charles Xuereb, CEO, Trident Estates Plc (Malta)

With these additions, the PAIB Advisory Group has achieved gender parity. Sanjay Rughani remains Chair and Sharon Ditchburn has been appointed Deputy Chair.

"Every member brings a distinctive and valuable viewpoint on the contributions of professional accountants in business and finance leadership,” said Sanjay Rughani, Chair, IFAC PAIB Advisory Group. “We are privileged to welcome these new members who will share their diverse experiences and offer strategic insights on the profession, expanding its contribution to sustainable economic development worldwide and serve as global champions for the profession.”  

The continuing PAIB Advisory Group members are:  

• Sanjay Rughani, Chair, CEO, Standard Chartered Bank Uganda (Uganda)
• Sharon Ditchburn, Deputy Chair, & Managing Director/Founder, Capital Advantage Consultants (Australia)
• Zia-Ul-Mustafa Awan, CFO and Business Administrator, Pakistan Expo Centres Private Limited (Pakistan)
• Anastasija Boljević, Secretary General, Institute of Certified Accountants of Montenegro (Republic of Montenegro)
• Esther Bosch, Director Risk & Audit, Royal Schiphol Group (Netherlands) 
• Ibrahim (Murat) Çağlar, Chief Financial Officer, Sanovel (Türkiye)
• Eric Freudenreich, Independent Non-Executive Director (France)
• Lindawati Gani, Professor in Management Accounting, Faculty of Economics and Business, Universitas Indonesia (Indonesia) 
• Tim Herrod, Vice President, Global Procurement, Albemarle Corporation (Canada)
• Margaret Muinde, Financial Controller, Kenya Roads Board (Kenya)
• Maria del Dado Alonso Sanchez, Group CFO, Berlin Brands Group (Spain) 
• Milton Segal, Executive Director: Standards, South African Institute of Chartered Accountants (South Africa)
• Muhammad Samiullah Siddiqui, CFO, Oxford University Press Pakistan (Pakistan) 
• Nancy Sau Ling Tse, JP, Independent Non-Executive Director [Hong Kong (Special Administrative Region of China)]
• Ichiro Waki, Group CEO, JBA Group (Japan)
• Gloria Zvaravanhu, Managing Director, Old Mutual Insurance Company (Zimbabwe)

Member expertise is drawn upon to deliver timely reports, articles, and case studies relevant to professional accountants in business across the globe. Explore their latest insights. 

About IFAC 
IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 180 members and associates in 135 countries and jurisdictions, representing more than 3 million accountants in public practice, education, government service, industry, and commerce. 

About the Professional Accountants in Business (PAIB) Advisory Group 
Professional accountants in business comprise a significant part of the profession working in commerce, industry, financial services, education, and the public and not-for-profit sectors. The Professional Accountants in Business (PAIB) Advisory Group focuses on ensuring these accountants meet the future needs of business and the public sector. 

Tangible natural resources are generally understood to be resources such as mineral resources, water, and living organisms that are naturally occurring. They account for a significant proportion of the economic resources in many jurisdictions. However, governments often lack sufficient information on the monetary value of natural resources, and as a result, grant rights to these resources without regard to financial and environmental sustainability, or intergenerational fairness.

To address the gap in the IPSAS literature on accounting for natural resources, the International Public Sector Accounting Standards Board^® (IPSASB^®) issued a Consultation Paper (CP) in May 2022. The IPSASB continues to develop principles for the recognition and measurement of natural resources, with the targeted publication of an Exposure Draft (ED) in the second half of 2024. However, following feedback received on the CP concerning the lack of guidance on specific activities related to mineral resources, this is being addressed first with the release of ED 86 and ED 87 for public comment:

• ED 86, Exploration for and Evaluation of Mineral Resources; and
• ED 87, Stripping costs in the Production Phase of a Surface Mine (Amendments to IPSAS 12).

ED 86 proposes a standard on accounting for the costs incurred in the exploration and evaluation of mineral resources, based on the selection of an accounting policy specifying which expenditure should be recognized as exploration and evaluation assets. ED 86 is aligned with the private sector requirements in IFRS 6, Exploration for and Evaluation of Mineral Resources, with limited changes for the public sector context.

ED 87 proposes adding an authoritative appendix to IPSAS 12, Inventories. The proposed guidance clarifies when to capitalize or expense costs incurred to remove waste material in surface mining operations. ED 87 is aligned with the guidance in IFRIC 20, Stripping costs in the Production Phase of a Surface Mine, with limited changes for the public sector context.

“As the IPSASB’s broader Natural Resources project continues to break new ground, the current proposals address some of the gaps in the literature on mineral resources in response to stakeholders needs,” said IPSASB Chair Ian Carruthers. “There is more to come in 2024 from the Natural Resources project, but these EDs are an important first step to providing useful financial information and improved accountability by the public sector in this important area.”

How to Comment

To access the EDs and the summary At-a-Glance documents, or to submit a comment, visit the IPSASB website, www.ipsasb.org. Comments on the EDs are requested by May 31, 2024. The IPSASB encourages IFAC® members, associates, and regional accountancy organizations to promote the availability of these EDs to their members and employees.

About the IPSASB 

The International Public Sector Accounting Standards Board (IPSASB) works to strengthen public financial management globally through developing and maintaining accrual-based International Public Sector Accounting Standards® (IPSAS®) and other high-quality financial reporting guidance for use by governments and other public sector entities. It also raises awareness of IPSAS and the benefits of accrual adoption. The Board receives support from the Asian Development Bank, the Chartered Professional Accountants of Canada, the New Zealand External Reporting Board, and the government of Canada. The structures and processes that support the operations of the IPSASB are facilitated by the International Federation of Accountants (IFAC). For copyright, trademark, and permissions information, please go to permissions or contact permissions@ifac.org. 
 

About the Public Interest Committee 

The governance and standard-setting activities of the IPSASB are overseen by the Public Interest Committee (PIC), to ensure that they follow due process and reflect the public interest. The PIC is comprised of individuals with expertise in public sector or financial reporting, and professional engagement in organizations that have an interest in promoting high-quality and internationally comparable financial information. 

Two new exposure drafts set forth the first comprehensive suite of global standards on ethical considerations in sustainability reporting and assurance

Proposed standards aim to foster greater trust in all publicly communicated sustainability information through the application of a consistent ethical approach

The IESBA welcomes comments from the entire sustainability community – professional accountants, all other sustainability practitioners, regulators, and investors

The International Ethics Standards Board for Accountants (“IESBA”) today announced the launch of two Exposure Drafts (EDs):

• International Ethics Standards for Sustainability Assurance ED, which includes revisions to the existing Code related to sustainability reporting;
• Using the Work of an External Expert ED

The Exposure Draft on International Ethics Standards for Sustainability Assurance (including International Independence Standards) (IESSA) and ethics standards for sustainability reporting proposes a clear framework of expected behaviors and ethics provisions for use by all sustainability assurance practitioners regardless of their professional backgrounds, as well as professional accountants involved in sustainability reporting. The goal of these standards is to mitigate greenwashing and elevate the quality of sustainability information, thereby fostering greater public and institutional trust in sustainability reporting and assurance. 

The Exposure Draft on Using the Work of an External Expert proposes an ethical framework to guide professional accountants or sustainability assurance practitioners, as applicable, in evaluating whether an external expert has the necessary competence, capabilities and objectivity in order to use that expert’s work for the intended purposes. The proposals also include provisions to aid in applying the Code’s conceptual framework when using the work of an external expert.

These proposed ethics (including independence) standards are especially relevant in a context where sustainability information is increasingly important for capital markets, consumers, corporations and their employees, governments and society at large, and when new providers outside of the accounting profession play a prominent role in sustainability assurance.

To coincide with the launch of the public consultation, the International Accreditation Forum (IAF) has announced its intention to stipulate to national accreditation bodies around the world that the IESBA’s proposed IESSA are to be used when accrediting and authorizing conformity assessment bodies to carry out assurance work on corporate sustainability disclosures¹.

The creation of an effective sustainability standards infrastructure requires not only high-quality sustainability reporting and assurance standards, but also a global baseline of ethics (including independence) standards to ensure the integrity and objectivity of sustainability information. The IESBA’s proposed standards are aimed at completing and supporting the effectiveness of that infrastructure. The development of both EDs was closely coordinated with the International Auditing and Assurance Standards Board (IAASB).

Gabriela Figueiredo Dias, Chair of the IESBA, commented, “Ethics is about acceptable behaviors and right decisions to avoid bias in sustainability information and foster trust. From investors looking for transparent and credible information, to consumers wanting to ensure the reliability of companies’ narratives about the sustainable credentials of their products and practices, and companies wanting to be trusted, all users of sustainability disclosures have a vested interest in ensuring ethical choices by the preparers and assurers of such information. These proposed standards will serve as a cornerstone of ethical behavior with far-reaching benefits.”

Jean-Paul Servais, Chair of the Board of the International Organization of Securities Commissions (IOSCO), said, “I am delighted to welcome today's publication and call on issuers, investors and assurance providers to participate in the IESBA’s consultation. Sustainability disclosures are undeniably high on the agenda of investors globally. Trust in such disclosures will be enhanced when they receive external assurance based upon globally accepted standards regarding ethical behavior and independence, that have been developed in the public interest. IOSCO will continue to play a key role in promoting global consistency in the assurance of sustainability-related disclosures by issuers and support its members and other stakeholders to enhance trust in corporate sustainability-related reporting.”

Alan Johnson, Chair of the IESBA and IAASB Stakeholder Advisory Council (SAC), independent corporate director, and Chair of the Good Governance Academy, stated: "IESBA’s Exposure Draft reflects the increasing demand for greater ethics and independence in corporate sustainability reporting. As the inaugural Chair of the Stakeholder Advisory Council, I view the proposed standards as critical to enhancing the integrity and credibility of sustainability information. These standards are a significant step towards ensuring that sustainability disclosures are ethically grounded and universally trusted while also enabling businesses around the world to provide full transparency of progress towards achieving sustainability goals and objectives.”

The development of the standards was preceded by extensive outreach, including four global roundtables which took place in March and April 2023 in Paris, Singapore, Sydney and New York. The roundtables involved over 140 senior-level representatives from stakeholders from very different jurisdictions and backgrounds, with a significant participation of non-professional accountants.

How to Comment 

The IESBA invites all stakeholders to provide their feedback on the EDs by visiting the IESBA’s website. Comments on the Using the Work of an External Expert ED are requested by April 30, 2024, and on the Sustainability ED by May 10, 2024.

Global Webinars and Other Resources

The IESBA will hold a series of global webinars where IESBA board members and staff will explain the key proposals in the EDs. Further information about the timing of the webinars, together with registration details, will be announced in the near future. In addition, the IESBA will soon release fact sheets and other explanatory materials on the EDs.

¹ when included in the ISO/IEC 17029 programme

#   #   #

About the IESBA

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 (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 more information about the IESBA, please visit https://www.ethicsboard.org/ and on LinkedIn at https://www.linkedin.com/company/iesba.

About the International Accreditation Forum

The IAF is a global association of accreditation bodies, conformity assessment body associations and other organizations involved in conformity assessment in fields including validation/verification and the certification of management systems, products, processes, services and persons.

The IAF promotes the worldwide acceptance of certificates of conformity and validation/verification statements issued by conformity assessment bodies accredited by IAF Multilateral Recognition Arrangement (MLA) signatories, and seeks to add value for all stakeholders through its activities and programs.

On January 1, 2024, the International Ethics Standards Board for Accountants (IESBA) welcomed three new members following their appointments by the Public Interest Oversight Board (PIOB) in November 2023.

• Tomoyo Imura (Japan), Director, Member of the Board, and Member of the Audit & Supervisory Committee, Nomura Asset Management Co. Ltd.

"I am honored to join the IESBA,’ said Ms. Imura. “I am eager to contribute to the enhancement of the IESBA standards, adapting them to the evolving global landscape. I firmly believe that maintaining an ethical mindset will be increasingly vital in the future."

• Amarjeet Singh (India), Member, Securities and Exchange Board of India (SEBI)

“'The societal expectations from today’s sustainability and technology-driven world of business and finance to have higher standards of ethics and integrity are rising,” said Mr. Singh. “The relevance of ethics in the financial world deserves center stage and needs greater public discourse. IESBA is playing a pivotal role in this space. It is a privilege to join the IESBA’s Board and contribute to its public interest work.”

• David Wray (France), retiring from Huawei, Global Finance, and current Board Member, International CFO Alliance (ICFOA)

“It is a genuine privilege to join IESBA at this important time of profound change for the accountancy profession and its global community of stakeholders,” said Mr. Wray.  “From the connectivity and digitalization of financial and sustainability information to technologies that stand ready to fundamentally change what we do as finance and audit professionals and how we do it, it is truly a once-in-a-lifetime experience to be part of this exciting journey. As an international finance leader, I look forward to helping shape the global profession and ensuring a transparent, connected, equitable, and level playing field for everyone globally, underpinned by the IESBA Code.”

The IESBA also welcomes the reappointments of:

• Saadiya Adam (South Africa), Senior Professional Manager for Standards at the Independent Regulatory Board for Auditors (IRBA) in South Africa
• Vania Borgerth (Brazil), Retired accountant, a PhD Candidate in Accountancy, Fucape Business School, Brazil; and Deputy Coordinator of International Relations at CBPS, the Brazilian Committee for Sustainability Pronouncements
• Sung-Nam Kim (Republic of Korea), Currently a non-partner advisor of EY Korea and a former Executive Auditor of the Korean Institute of Certified Public Accountants (KICPA)
• Andrew Mintzer (United States of America) a principal at Hemming Morse LLP, providing forensic accounting services, and
• Luigi Nisoli (Italy), Partner and Director of Independence at Deloitte

“It gives me great pleasure to welcome Tomoyo, Amarjeet, and David to the IESBA, and I congratulate Saadiya, Vania, Sung-Nam, Andy, and Luigi on their reappointments,” said IESBA Chair Gabriela Figueiredo Dias. “The challenges ahead for IESBA are significant as we take on issues of global importance, like ethics in sustainability reporting and assurance, accounting firm culture and governance, and the expansion of the scope of the Code. To meet these challenges, we’ve set aggressive targets and made global commitments. We know the opportunities ahead are great when we lead with ethics. By bringing in three new perspectives, and three new voices, we grow as a Board. By keeping the voices of Saadiya, Vania, Sung-Nam, Andy, and Luigi, we bring continuity and “board” knowledge alongside their valued input and deep understanding of our issues.  I look forward to all the diverse and unique insights as they will all add to IESBA’s knowledge base and help guide our strategic thinking.”

The PIOB’s Invitation for Application for IESBA members for terms of service beginning in January 2025 is currently open. The IESBA encourages qualified candidates to apply.

About IESBA

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 (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.

The International Auditing and Assurance Standards Board (IAASB) is pleased to welcome five new members following their appointments by the Public Interest Oversight Board (PIOB) in November 2023.

• Sami Alshorafa is the Deputy for Supervision, Capital Market Authority Saudi Arabia, where he is based. He leads the supervision of listed entities' financial statements, auditors, and governance as well as compliance of collective investment schemes. He has also worked as an audit partner at two of the big four audit firms.

Mr. Alshorafa: “Being part of the IAASB constitutes an excellent opportunity for accountants and specialists from different backgrounds and different geographical jurisdictions to come together with one main objective in mind, which is serving the public interest of the capital markets by cooperating in the development of high-quality auditing standards.”

• Hernán Casinelli is the Chair of the Accounting and Assurance Standards Board of Argentina, where he is based. He has held positions as a member of the International Accounting Standards Board’s SME Implementation Group and the IAASB's ISA for LCEs’ Reference Group.

Mr. Casinelli: “I look forward to working in the public interest to develop standards that enhance confidence in corporate reporting. I am certainly joining the IAASB at an exciting and challenging time.”

• Vishal Doshi is a Council member of the Institute of Chartered Accountants of India. He is also the Vice Chair of ICAI’s Auditing and Assurance Standards Board and a partner in K C Mehta & Co LLP, in India, where he is based.

Mr. Doshi: “The IAASB plays a very important role in global standards setting and I am looking forward to contributing towards the IAASB' s objectives to meet stakeholders’ expectations and serve public interest.”

• Robert Koethner is the retired Vice President, Chief Accounting Officer, Mercedes-Benz Group AG, a role he held for more than 20 years. During his career, he worked closely with audit firms as well as governance bodies, including supervisory boards and audit committees, on an international scale. He is based in Germany.

Mr. Koethner: “As a former Chief Accounting Officer for a publicly listed and globally operating company I am looking forward to share my experience from a preparers side with my fellow board members to deliver international high-quality auditing standards.”

• Chrystelle Richard is Associate Professor in Accounting, ESSEC Business School, and is based in France. Dr. Richard teaches financial accounting and sustainable reporting in bachelor, master, and executive programs. Her primary research interests focus on firms' oversight and new forms of economic governance, including public-private partnerships and financial industry regulation.

Dr. Richard: “I feel very privileged to serve the IAASB at such an exciting time. The challenges of sustainability as well as technological developments present the IAASB with an ambitious and demanding agenda in 2024 and beyond. I am deeply honored to provide my academic expertise to the IAASB, and I am fully committed to serve it with the highest sense of the public interest.”

The IAASB is also pleased to share that two members were re-appointed by the PIOB for terms that also began on January 1, 2024:

• Edo Kienhuis is PwC’s Global Standards Leader and a partner in the Audit and Assurance practice in Amsterdam, where he is a member of the National Office Methodology team and serves as an engagement quality review partner on several listed entities; and
• Wendy Stevens is the National Practice Leader for Quality & Risk Management (QRM) at Mazars in the US, the Mazars Group International Quality Management leader, and a member of the Mazars Group QRM Board.

The PIOB’s Invitation for Application for IAASB members for terms of service beginning in January 2025 is open until February 9, 2024. The IAASB encourages qualified candidates to apply.

About the IAASB
The International Auditing and Assurance Standards Board develops auditing, assurance, related services, and quality management standards and guidance in the public interest that support consistent performance of quality engagements. Along with the International Ethics Standards Board for Accountants, the IAASB is part of the International Foundation for Ethics and Audit. The Public Interest Oversight Board oversees IAASB and IESBA activities and the public interest responsiveness of the standards. For copyright, trademark, and permissions information, please visit Permissions.

The International Federation of Accountants (IFAC) today released a literature review, Educating Accountants for a Sustainable Future: A Literature Review of Competencies, Educational Strategies, and Challenges for Sustainability Reporting and Assurance. The review highlights key themes in current sustainability-related education, learning and development to provide insights on how the global accountancy profession can meet stakeholder demands for relevant and reliable sustainability reporting.

Recent years have seen a significant shift in demand for relevant sustainability-related disclosure, reporting, and assurance and the accountancy profession is working to prepare current and future professionals to meet these stakeholder demands. The literature review identifies the new and existing competencies required of professional accountants to provide these services; educational strategies to develop them; and the challenges the accountancy education community will face. The literature review also informed IFAC’s decision to make sustainability-related revisions to the International Education Standards  and will contribute to the forthcoming proposed revisions, expected in Q2 2024.

In addition to the literature review, IFAC will host a joint webinar with the International Association for Accounting Education & Research (IAAER) on February 7, 8:00 AM to 9:30 AM EST, featuring a discussion with the review’s lead author. Register for the webinar here.

About IFAC
IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 180 members and associates in more than 135 jurisdictions, representing millions of professional accountants in public practice, education, government service, industry, and commerce.

Today, the International Auditing and Assurance Standards Board (IAASB) launched a consultation process on proposed narrow scope amendments to achieve greater convergence with the International Ethics Standards Board for Accountants’ (IESBA) International Code of Ethics for Professional Accountants (Including Independence Standards). These proposed revisions have two key objectives. First, they would align definitions and requirements in IAASB standards with new definitions for publicly traded and public interest entities in the IESBA Code. Second, the amendments would extend the applicability of existing differential requirements for listed entities to meet heightened stakeholder expectations regarding audits of public interest entities (PIE).

Key proposed revisions include extending the scope of the entities included under the International Standards on Quality Management and the International Standards on Auditing such that they will be subject to:

• Engagement quality reviews;
• Providing transparency in the auditor’s report on specific aspects of the audit, including auditor independence, communicating key audit matters, and the engagement partner’s name; and
• Communicating with those charged with governance to help them fulfill their responsibility overseeing the financial reporting process, (e.g., communicating about quality management and auditor independence).

How to Comment

The IAASB invites all stakeholders to provide feedback on the Exposure Draft using the digital Response Template, which is available on the IAASB website. Feedback is requested by April 8, 2024.

About the IAASB

The International Auditing and Assurance Standards Board develops auditing, assurance, related services, and quality management standards and guidance in the public interest that support consistent performance of quality engagements. Along with the International Ethics Standards Board for Accountants, the IAASB is part of the International Foundation for Ethics and Audit. The Public Interest Oversight Board oversees IAASB and IESBA activities and the public interest responsiveness of the standards. For copyright, trademark, and permissions information, please visit Permissions.

At its December Board meeting, the International Ethics Standards Board for Accountants (“IESBA”) successfully completed and approved an Exposure Draft on Ethics and Independence Standards for Sustainability Reporting and Assurance and the final Ethics Standard for Tax Planning and Related Services. Other major achievements of the IESBA December Board meeting include the approval of an Exposure Draft on the Use of Experts and of the IESBA’s Strategy and Work Plan for 2024-2027.

Commitment to Trustworthy Sustainability Reporting and Assurance

The IESBA voted and approved the proposed new International Ethics Standards for Sustainability Assurance (including International Independence Standards) (“IESSA”), and proposed revisions to the International Code of Ethics for Professional Accountants (“the Code”) on sustainability reporting. The Exposure Draft will contain proposed independence standards for use by all sustainability assurance practitioners regardless of whether they are professional accountants, and specific ethics provisions relevant to sustainability reporting and assurance. This milestone completes more than 18 months of intensive fact-finding, outreach, and drafting efforts by the IESBA Board and staff.

The result is a set of draft standards that will establish the essential third pillar of ethics, including independence, standards to support public and corporate trust in sustainability-related information, alongside sustainability reporting and assurance standards. The IESBA intends to release the Exposure Draft in late January 2024.

Using the Work of External Experts

The IESBA approved proposed ethics provisions addressing the use of external experts by organizations as well as in the context of audit and assurance engagements, including sustainability assurance engagements. Professional accountants and sustainability assurance practitioners will be guided by an ethical framework to evaluate the competence, capabilities, and objectivity of external experts. These provisions will thereby help meet public expectations concerning ethical behavior when using external experts, especially in an audit or assurance context.

Strengthening Ethical Behavior in Tax Planning

The IESBA also approved final revisions to the Code to address tax planning and related services. These revisions respond to heightened public concerns about ethical behavior in tax planning in light of high-profile revelations about tax avoidance schemes in several jurisdictions in recent years. The final provisions establish an ethical framework in the public interest to guide professional accountants in making judgments and decisions when providing tax planning or related services. Pending certification by the Public Interest Oversight Board (“PIOB”), the final pronouncement is expected to be issued by mid-April 2024.

Strategy and Work Plan 2024-2027

The IESBA voted to approve its Strategy and Work Plan (“SWP”) for 2024-2027. Among other matters, the IESBA will tackle two new ambitious strategic areas of focus: accountancy firm culture and governance, and extending the impact of the Code beyond the accountancy profession, where it believes it can significantly expand reach and business impact.

Throughout 2023, the IESBA has responded vigorously to the challenges of ethics in the accountancy profession and beyond. The IESBA’s 2024 agenda will focus on final approvals of the sustainability-related  standards, as well as on new workstreams addressing accountancy firm culture and governance, and independence considerations regarding the audits of collective investment vehicles, pension fund arrangements, and investment company complexes.

“The global shift of governments, companies, and investors towards a more sustainable future will not happen with good intentions and soft targets,” said IESBA Chair Gabriela Figueiredo Dias. “This movement will require hard ethics to realize sustainability goals and mitigate the risks of wrongdoing. The IESBA’s new and proposed revisions to the Code and the Board’s strategy will help ensure that professional accountants and other sustainability assurance practitioners adopt the necessary ethical approaches to foster transparency, relevance, and public trust within the reporting sphere while supporting global sustainability efforts.”

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 more information about IESBA, please visit www.ethicsboard.org and on LinkedIn at www.linkedin.com/company/iesba.