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Non-Assurance Services

Non-Assurance Services. Isabelle Sapet , IESBA Deputy Chair. IESBA CAG Meeting September 11, 2013 New York. Background. Non-assurance services (NAS) work stream added to work plan in 2012 Consider additional restrictions concerning NAS

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Non-Assurance Services

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  1. Non-Assurance Services Isabelle Sapet, IESBA Deputy Chair IESBA CAG Meeting September 11, 2013 New York

  2. Background • Non-assurance services (NAS) work stream added to work plan in 2012 • Consider additional restrictions concerning NAS • Determine if materiality is still appropriate as a basis for prohibiting certain NAS and if guidance is necessary to apply it • Consider if preapproval of NAS by those charged with governance (TCWG) is appropriate • General Board agreement to objective of project but with some concern as to scope given the recent independence projects (Independence I & II)

  3. Non-Assurance Surveys • Surveys requesting information sent to 26 jurisdictions • Information sought with respect to PIEs and non-PIEs • National provisions concerning NAS that are not addressed in the Code • Survey also covered five key areas: • Assuming management responsibility • Preparing accounting records and financial statements • Valuation services • Taxation services • Internal audit services

  4. Survey Responses • Results noted the following: • Jurisdictions are in line with the Code regarding most of Code’s provisions • Approximately half of the jurisdictions surveyed specified more restrictive provisions concerning taxation, valuation and internal audit services mostly due to local laws and regulations • Significant number of jurisdictions do not have emergency provisions for bookkeeping or taxation services • Re materiality, responses varied in terms of services to which materiality may be applied, if at all

  5. IESBA Conclusions • Code’s approach to, and provisions for, taxation, internal audit and valuation services remain appropriate and will not be part of project scope • Code will benefit from and thus the scope of the project will include: • Clarification concerning “management responsibilities” and bookkeeping services that are “routine and mechanical” for consistency in application • Reconsideration of the emergency provisions for bookkeeping and taxation services

  6. IESBA Conclusions • IESBA also will develop a paper concerning NAS • Used as communication vehicle to raise awareness of Code’s approach to NAS • Emphasize robustness of Code’s NAS provisions • Highlight supplementary approaches to enhance “threats & safeguards” approach • Increase visibility and transparency of Code’s relevant provisions • Discuss taxation, valuation and internal audit services • IESBA to consider outline of paper next week

  7. Next Steps • IESBA consideration of revised project proposal next week • Proposed changes to the Code for approval for exposure at April 2014 IESBA meeting • First draft of NAS paper December 2013 IESBA meeting • CAG discussion March 2014 • Final draft of the NAS paper for IESBA approval July 2014

  8. Questions?

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