Tuesday, February 1, 2022
The AUASB has finalised its submission on the IAASB’s Exposure Draft of proposed ISA for Audits of Financial Statements of Less Complex Entities. The AUASB’s response, compiled after extensive consultation, supports the concept of the IAASB developing a standalone standard targeted at LCE audits. However, in its current form, the AUASB considers that the proposed standard would add to the audit expectation gap, with users perceiving that the proposed standard results in a less robust audit, reduced audit effort and consequently an inappropriate expectation of reduced audit fees.
Despite the opposition to the proposed standard, the AUASB’s submission commends the IAASB on the priority and urgency they have applied to this topic. The project has also reinforced the AUASB’s view that the scalability and proportionality of the existing ISAs applicable to all audits needs to be improved.
A copy of the AUASB’s submission, which includes detailed responses to the questions included in the IAASB’s LCE exposure draft, can be accessed via the AUASB Website here. If you have any queries about the submission please contact the AUASB at [email protected]