IRBA Newsletter Issue 50

Issue 50 | April - June 2020 7 The Strategy and the Work Plan are available in PDF formats and may be downloaded from the IAASB website . IAASBExposureDraft: Proposed International Standard on Auditing 600 (Revised): Special Considerations – Audits of Group Financial Statements (Including the Work of Component Auditors) The IAASB has issued the proposed International Standard on Auditing (ISA) 600 (Revised): Special Considerations – Audits of Group Financial Statements (Including the Work of Component Auditors) (ED-ISA 600 (Revised)) for public comment. ED-ISA 600 (Revised) introduces an enhanced risk-based approach to planning and performing a group audit. This approach appropriately focuses the group engagement team’s attention and work effort on identifying and assessing the risks of material misstatement of the group financial statements, and on designing and performing further audit procedures to respond to those assessed risks. In addition, ED-ISA 600 (Revised) recognises that component auditors can be, and often are, involved in all phases of a group audit. In such circumstances, the proposed standard highlights the importance of the group engagement team’s involvement in the component auditor’s work. ED-ISA 600 (Revised): • Clarifies the scope and applicability of the standard; • Emphasises the importance of exercising professional scepticism throughout the group audit; • Clarifies and reinforces that all ISAs need to be applied in a group audit through establishing stronger linkages to the other ISAs, in particular to proposed ISA 220 (Revised), ISA 315 (Revised 2019) and ISA 330; • Reinforces the need for robust communication and interactions between the group engagement team, group engagement partner and component auditors; • Includes new guidance on testing common controls and controls related to centralised activities; • Includes enhanced guidance on how to address restrictions on access to people and information; and • Enhances special considerations in other areas of a group audit, including materiality and documentation. Request for Comments The CFAS welcomes comments on all matters addressed in ED-ISA 600 (Revised), including responses to the specific questions set out in the Explanatory Memorandum. Comments should be submitted via email to standards@irba.co.za by 4 September 2020 . All comments will be considered as a public record. Alternatively, we invite registered auditors and other interested parties to submit comments directly to the IAASB via the IAASB website by 2 October 2020 . Due to the impact of COVID-19, the IAASB has departed from its normal 120-day comment period for public consultations. IAASB Projects in Progress • Audit evidence. • Technology. • Quality management at firm level (ISQM 1). • Engagement quality review (ISQM 2). • Quality management at engagement level (ISA 220). • Group audits (ISA 600). • Extended external reporting (EER) assurance. • Audits of less complex entities (LCE). • Professional scepticism. More information on these projects is available on the IAASB website . STANDARDS cont.