At its April meeting, the International Auditing and Assurance Standards Board (IAASB) confirmed its intention to advance the consultation on its proposed new standard for sustainability assurance, International Standard on Sustainability Assurance^TM (ISSA) 5000, General Requirements for Sustainability Assurance Engagements. Subject to the expected IAASB approval of the Exposure Draft in June, stakeholders can now expect the public consultation on the proposed standard to open in the latter part of July or early August 2023 and extend into December 2023. The consultation was originally scheduled to commence in October 2023.

The advanced consultation will support two objectives. First, the earlier publication, accompanied by a comprehensive and global outreach strategy, will enable the IAASB to gain broad and early input into the development of ISSA 5000. Second, the advanced consultation period will better ensure the completion of the final standard in 2024. In a recent report, the International Organization of Securities Commissions (IOSCO) highlighted the importance of having ISSA 5000 developed in accordance with due process and ready in 2024 to support a global baseline for sustainability reporting and assurance standards that meets the public interest.

When complete, ISSA 5000 will be a stand-alone, overarching standard suitable for both limited and reasonable assurance of sustainability information reported across any sustainability topics. The standard will enable engagements of sustainability information prepared under multiple frameworks and be profession-agnostic, supporting its use by both professional accountant and non-professional accountant assurance practitioners in performing sustainability assurance engagements.

During the consultation process, the IAASB will continue to coordinate closely with the International Ethics Standards Board for Accountants (IESBA) as the IESBA progresses its project to develop ethics and independence standards for sustainability reporting and assurance. This coordination will ensure that the IESBA and IAASB’s collective efforts provide an integrated package of ethics and assurance standards for sustainability by the end of 2024. The IAASB will also actively monitor, engage, and coordinate with other standard setters and organizations developing standards and guidance on sustainability reporting and assurance.

“The IAASB has prioritized the development of a high-quality, global sustainability assurance standard. In our recent outreach, stakeholders told us they are awaiting our proposals and urged us not to delay getting them into the market to benefit fully from diverse stakeholder opinion,” commented IAASB Chair Tom Seidenstein. “What will be critical now, as already encouraged by IOSCO, is for issuers, investors and other users, assurance providers, national standard setters, and others across the ecosystem to plan resources so that they can provide us their views during the consultation process. This is essential to ensure a final standard that is robust and drives high-quality assurance engagements, while meeting the needs of users and being profession-agnostic.”

The IAASB recently discussed this revised timetable with its oversight body, the Public Interest Oversight Board (PIOB). Linda de Beer, the PIOB Chair, said, “The PIOB is encouraging the IAASB to advance the development of a global assurance standard for sustainability reports and supports IAASB’s early and extensive consultation plan, as proposed by the IAASB’s timelines. It is in the public interest to have timely a single international assurance standard, set with an appropriate level of public interest oversight, to avoid fragmentation and potential market confusion in respect of the work effort and the level of assurance provided by all assurance providers on sustainability reports. We also welcome the IAASB and IESBA continuing coordination.”

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.

On April 18, 2023, the International Ethics Standards Board for Accountants (IESBA) held a global webinar to review recent revisions to the International Code of Ethics for Professional Accountants (including International Independence Standards) (the Code) to address holistically the various independence considerations in an audit of group financial statements.

The hour-long Engagement Team – Group Audits (ET-GA) Independence webinar was led by Caroline Lee, former IESBA Member and ET-GA Task Force Chair, and Saadiya Adam CA (SA), IESBA Member and ET-GA Member, and was attended by 252 live participants worldwide.

Learn more about the ET-GA revisions here.

The International Ethics Standards Board for Accountants (IESBA) today released final revisions to the International Code of Ethics for Professional Accountants (including International Independence Standards) to further increase the Code’s robustness and expand its relevance in a world being fundamentally reshaped by rapid technological advancements and accelerating digitalization.

The revisions will guide the ethical mindset and behavior of professional accountants in both business and public practice as they take advantage of the opportunities created by technology and adapt to new technology. Developed to remain relevant and applicable in the ever-evolving landscape of technology transformation, the revisions apply to the use of any technology, including to the extent possible, future technologies.

“Technological innovation is transforming how work is performed and how professional services are delivered as well as enabling new services in ways never before imagined,” said Ms. Gabriela Figueiredo Dias, IESBA Chair. “It is crucial and in the public interest that we provide strong, clear and principles-based standards to equip professional accountants around the world in navigating the ethical risks and challenges brought on by technology.”

The revisions, which were informed by extensive fact-finding and stakeholder outreach:

• Strengthen the Code in guiding the mindset and behavior of professional accountants when they use technology.
• Provide enhanced guidance fit for the digital age in relation to the fundamental principles of confidentiality, and professional competence and due care, as well as in dealing with circumstances of complexity.
• Strengthen and clarify the International Independence Standards (IIS) by addressing the circumstances in which firms and network firms may or may not provide a technology-related non-assurance service to an audit or assurance client.

The revisions to the IIS will be effective for audits and reviews of financial statements for periods beginning on or after December 15, 2024. The other revisions to the ethics provisions of the Code will be effective as of December 15, 2024. Early adoption is permitted.

About the IESBA

The International Ethics Standards Board for Accountants serves the public interest by setting 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. 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. For copyright, trademark, and permissions information, please visit Permissions.

The International Ethics Standards Board for Accountants (IESBA) today released its Proposed Strategy and Work Plan, 2024-2027: Towards a More Sustainable Future: Advancing the Centrality of Ethics for public comment.  

The proposed strategy and work plan sets out the IESBA’s vision, strategic drivers and themes to guide its actions over the next strategy period of 2024-2027, as well as a number of topics the IESBA has identified as potential new work streams for the period.

“Ethics plays a central and crucially important role in advancing the public interest regardless of the external environment and the area or field of professional endeavor,” said IESBA Chair Gabriela Figueredo Dias. “From the continuing pervasive impact of technological advancements to the exponential growth in the supply of sustainability information, our aim in the coming years is to develop global ethics and independence standards that guide ethical behavior and underpin public trust in information that is fundamental to the proper functioning and sustainability of organizations, financial markets and economies worldwide.”

The proposed strategy recognizes the public commitment the IESBA has made to developing timely ethics (including independence) standards for sustainability reporting and assurance to meet the increasing needs of investors, customers, workers, government agencies and other stakeholders for sustainability information.

While the International Code of Ethics for Professional Accountants (including International Independence Standards) has been significantly strengthened in recent years, the IESBA believes it is important to continue to evolve the Code with developments in business and the external environment to maintain its robustness and relevance, a need further emphasized by continuing corporate failures around the world that erode public trust in the accountancy profession.

Among other actions to achieve its strategic vision, the IESBA plans to devote significant efforts to expanding and strengthening its working relationships with a wide range of stakeholders. Additionally, the IESBA plans to continue to strengthen its coordination with its sister Board, the International Auditing and Assurance Standards Board (IAASB), as well as other international and national standard setters, to enhance the Code’s interoperability with reporting and assurance standards within the financial and sustainability reporting ecosystems.

The IESBA invites stakeholders to submit their responses by July 7, 2023.

About the IESBA

The International Ethics Standards Board for Accountants serves the public interest by setting 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. 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. For copyright, trademark, and permissions information, please visit Permissions.

The International Ethics Standards Board for Accountants (IESBA) is saddened by the untimely passing of Brian Friedrich, a long-term board member, and friend to many.

Born and raised in Western Canada, Brian was a significant contributor to the IESBA’s work, including leading several initiatives and global outreach. He had an infectious energy in promoting the importance of education and ethics for professionals worldwide. Committed to inclusive and collaborative discourse, he always challenged colleagues to think about issues in fresh and innovative ways, especially in his role as Chair of the Technology Working Group.  

He lived life – both personally and professionally – on his own terms, always pushing boundaries and questioning arbitrary conventions.  His commitment to ethics and the public interest was unwavering, and his perceptive nature and intelligence played a significant part in promoting IESBA’s mission and elevating the role of ethics in the global accountancy profession.

Above all, Brian was a trusted friend to his fellow Board members and IESBA Staff, who will all miss him greatly. His warm personality and friendship will stay with his colleagues and friends, and his passion will continue to inspire.

The thoughts and condolences of the IESBA community are with Brian's wife and professional partner, Laura, and their family during this difficult time.

A celebratory memorial for Brian is being arranged. In lieu of flowers, the family requests that donations be made to your local Society for the Prevention of Cruelty to Animals or your local Heart and Stroke Foundation.

The International Ethics Standards Board for Accountants and the International Auditing and Assurance Standards Board applaud the recent announcement by the International Sustainability Standards Board (ISSB) that final decisions for all technical content related to ISSB's inaugural sustainability standards have been made and that the ISSB is entering the final stages of the standards development process ahead of an expected issuance at the end of Q2 2023.

We echo the recent statement of support from the International Organization of Securities Commissions (IOSCO) and appreciate IOSCO's encouragement for our boards’ work to develop standards by the end of 2024. The IOSCO statement is a timely reminder that providing the necessary assurance and ethics standards is essential to complete the sustainability reporting and assurance standards infrastructure. We will continue to work closely with all parties as we develop our sustainability standards, which we will discuss at our respective March meetings.

The International Ethics Standards Board for Accountants (IESBA) today released final revisions to the International Code of Ethics for Professional Accountants (including International Independence Standards) (the Code) to address holistically the various independence considerations in an audit of group financial statements. The revisions also deal with the independence and other implications of the changes made to the definition of an engagement team in the Code to align with changes to the definition of the same term in the International Auditing and Assurance Standards Board’s (IAASB) International Standards on Auditing (ISAs) and International Standards on Quality Management (ISQMs).

“Group audits play a fundamental role in safeguarding the integrity of, and public trust in, the financial markets,” said Ms. Gabriela Figueiredo Dias, IESBA Chair. “For a long time, there was a vacuum in international standards addressing the independence of audit firms and individuals involved in group audits, leading to uncertainty and inconsistent practice around the world. This standard effectively closes that gap and responds in a timely manner to a public interest need for robust and clear requirements for independence in this important area.” 

Among other matters, the revisions:

• Strengthen and clarify the independence principles that apply to:
  • Individuals involved in a group audit, including those within, or engaged by, firms that audit components within a group.
  • ​​​​​​​Firms engaged in the group audit, including firms within and outside the group auditor firm’s network.
• ​​​​​​​Specify the need for, and content of, appropriate communication on independence matters between the group auditor firm and component auditor firms participating in the group audit.
• More explicitly set out the process to address a breach of an independence provision at a component auditor firm, reinforcing the importance of transparency and appropriate communication with those charged with governance of the group.
• Amend the definitions of the terms “engagement team” and “audit team” in the Code to recognize the different and evolving engagement team structures, and address the implications of those definitional changes.
• Provide guidance to facilitate the determination of who is included in an engagement team or an audit team.
• Revise the definitions of a number of existing terms and establish new defined terms with respect to independence in a group audit context.

​​​​​​​The development of the proposals has benefited from close coordination with the IAASB’s group audits and quality management projects.

The pronouncement will be effective for audits of financial statements and group financial statements for periods beginning on or after December 15, 2023, with early adoption permitted.

Global Webinar and Other Implementation Support

The IESBA will hold a global webinar on April 18, 2023 from 9:00 to 10:00 am Eastern Time, during which members of Task Force will explain the key revisions to the Code. Click here to register.

The recording of the webinar and other supporting materials, such as an IESBA Staff publication on Frequently Asked Questions, will be available on the IESBA’s website in due course.

The International Ethics Standards Board for Accountants (IESBA) today released for public comment the Exposure Draft Proposed Revisions to the Code Addressing Tax Planning and Related Services.

The proposed revisions respond to public interest concerns about tax avoidance and the role played by consultants, including professional tax advisers, in light of revelations in recent years such as the Paradise and Pandora Papers. The proposals strengthen the ethical expectations for professional accountants in business and in public practice when performing tax planning activities for employing organizations or providing tax planning services to clients, respectively.

“The accountancy profession plays a trusted role in facilitating the efficient and effective operation of a jurisdiction’s tax system and in making it a pillar of the economic system,” said IESBA Chair Ms. Gabriela Figueiredo Dias. “However, it is crucial that there are clear and robust ethical guardrails when professional accountants assist their employing organizations’ and clients’ tax planning to safeguard the public interest. These timely proposals are also designed to provide professional accountants with practical guidance to navigate the ethical challenges in this complex area.”

Among other matters, the proposed ethical framework:

• Explains the types of threats to compliance with the fundamental ethics principles of the Code that might be created when professional accountants are involved in tax planning.
   
• Sets a clear principle that professional accountants recommend or otherwise advise on a tax planning arrangement only if they have determined that there is a credible basis in laws and regulations for it.
• Requires consideration of the reputational, commercial and wider economic consequences that could arise from the way stakeholders might view the tax planning arrangement before determining whether to proceed with the recommendation or advice.
• Provides practical guidance to assist professional accountants in navigating situations of uncertainty when carrying out tax planning.
• Deals with other practical matters, including disagreement with the client or management or those charged with governance, and documentation.

The development of the proposals has been informed by extensive fact finding and outreach to stakeholders, including three global roundtables held in April 2022.

How to Comment 
The IESBA invites all stakeholders to comment on the Exposure Draft by visiting the IESBA’s website. Comments are requested by May 18, 2023.

Global Webinars
The IESBA will hold three webinars where members of the Tax Planning and Related Services Task Force will explain the key proposals in the exposure draft. The webinars will be held virtually on:

• Monday February 27 | 10 am – 11 am EST | Click here to register
• Tuesday February 28 | 4 pm – 5 pm EST | Click here to register
• Tuesday February 28 | 9 pm – 10 pm EST | Click here to register

The Staff of the International Ethics Standards Board for Accountants (IESBA) today released a questions and answers (Q&As) publication on the revisions to the definitions of listed entity and public interest entity (PIE) in the International Code of Ethics for Professional Accountants (including International Independence Standards) (the Code). The development of the Q&As has been informed by the extensive discussions and consultations with a wide range of stakeholder groups and the IESBA’s own deliberations during the development and finalization of the PIE revisions.

The Q&A publication is designed to highlight, illustrate or explain aspects of the PIE revisions in the Code and is intended to complement the Basis for Conclusions for the final pronouncement. It will assist national standards setters, professional accountancy organizations, and firms in adopting and/or implementing the PIE revisions. The Q&As will also assist regulators and audit oversight bodies, the corporate governance community, investors, preparers, educational bodies or institutions, and other stakeholders in understanding the revised PIE definition and related provisions in the Code. Among other things, the PIE revisions:

• Include an expanded definition of a PIE by specifying a broader list of PIE categories, including a new category “publicly traded entity” to replace the category “listed entity.”
• Recognize the essential role local bodies responsible for the adoption of the Code play in delineating the specific entities that should be scoped in as PIEs in their jurisdictions, encouraging them to properly define the PIE categories in the expanded definition and adding any other categories relevant to their environments.
• Introduce a transparency requirement for firms to publicly disclose the application of independence requirements for PIEs where they have done so.

The PIE revisions are effective for audits of financial statements for periods beginning on or after December 15, 2024. Read the revisions here.

The International Federation of Accountants (IFAC), the voice of the global accountancy profession, announces that Helen Partridge has been named Chief Financial Officer, effective April 1, 2023.  

Ms. Partridge, who joined IFAC in 2020, assumes leadership for IFAC’s finance team and financial activities, including accounting, financial strategy, planning and analysis, and tax.  Previously, Ms. Partridge oversaw IFAC’s Accountancy Education platform, enhancing the multi-stakeholder model, significantly expanding the EdExchange Summit, and driving knowledge-sharing programming for Education Directors. 

On her appointment Ms. Partridge said, “I am delighted with the opportunity to further elevate the strategic role of finance within IFAC, and to help shape IFAC’s strategy in support of the global profession.  I have never been more convinced of the growing importance of --and need for-- professional accountants, whose expertise is integral to the creation and management of sustainable companies, economies and societies.” 

Ms. Partridge continued, “I also look forward to continued involvement in Accountancy Education, which remains a personal and professional passion.  Bruce Vivian, our new head of Accountancy Education, brings a wealth of experience to the role.  I have no doubt that he, in ongoing partnership with the International Panel on Accountancy Education, will only further accelerate our strong momentum.” 

Kevin Dancey, Chief Executive Officer, said, “Helen is a high-impact executive with a proven track record of success in advancing IFAC’s Accountancy Education platform.  As she moves into the CFO role, I have every confidence she will be an excellent partner to me and the IFAC management team in delivering on our strategy.” 

Prior to joining IFAC, Ms. Partridge was an accountant in practice, having spent 16 years with PwC in audit, advisory and audit systems design in the US and Asia Pacific. She has also served in the controllership function at a large multinational transportation company working with GAAP conversions, financial statement preparations and complex and significant transactions such as business combinations and tax planning. Ms. Partridge is a CPA licensed in multiple states in the United States. 

In addition to Ms. Partridge, other women leaders at IFAC include Jennifer DiClerico, Head of Communications; Linda Lach, Head of Governance; and Elaine Young, Head of Human Capital. Partridge succeeds Russell Guthrie, who will be leaving IFAC in June after a successful 22-year career in various leadership capacities including finance, strategy, capacity building and member and external relations.

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 more than 180 members and associates in 135 jurisdictions, representing more than 3 million accountants in public practice, education, government service, industry, and commerce.