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Definition of Engagement Team

Definition of Engagement Team. New York, December 2012. Definition of Engagement Team. Overview of responses. Definition of Engagement Team. Overview of responses . Not supportive

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Definition of Engagement Team

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  1. Definition of Engagement Team New York, December 2012

  2. Definition of Engagement Team Overview of responses

  3. Definition of Engagement Team Overview of responses • Notsupportive • 11 auditregulatorsfrom EU (representingCzech Republic, France, Luxembourg, Malta, The Netherlands, Norway, Portugal, Romania, Slovenia, Spain and Switzerland) • ICAC (Regulator - Spain) • IDW and WPK (Germany) • Some concerns • IOSCO • APESB (Australia) • ACCA (UK) • CPAA (Australia)

  4. Definition of Engagement Team Overview of responses • IOSCO comments: • IOSCO membershavevaryingpositions on directassistance • Shouldnotimplydirectassistanceis appropriate butaimto assist externalauditorsconducttheir work wheredirectassistanceispermitted • IAASB and IESBA shouldjointlyconsiderobjectivity in situationswheredirectassistanceispermitted • Safeguardingrequirementsshouldbemodifiedto cover followingaspectsofdirectassistance: • Re-performance • Shouldnotrepresentsignificantportionof total audit work • Shouldnot include mattersof high risk or of high judgment • Shouldnotusedirectassistanceifthereissignificantthreatstoobjectivityof the internalauditfunction • Referencetothesesafeguardsshouldbemade in the Code

  5. Definition of Engagement Team Conclusions of the combined IAASB and IESBA Task Forces • Toaddressconcernsraised in the IOSCO teleconferences and EAIG meeting the followingchanges are beingproposedto ISA 610: • IAASB proposesaddingguidance on whensafeguardswouldbeunableto reduce threatstoobjectivityof the internal auditor toacceptablelevel (seeparagraph A32x) • Wording in paragraph 27 to include requirementtomakeinquiriesof the internal auditor • “stand-back” requirementfor auditor toevaluate the planneduseof the intrenalauditfunction (similarto the stand-back requirementforuseofdirectassistance) • In paragraph 27 emphasize the needfor the external auditor toindependentlyevaluate the extenttowhich DA can beused

  6. Definition of Engagement Team Conclusions of the combined IAASB and IESBA Task Forces ProposedRevisedDefinition Engagement team—All partners and staff performing the engagement, and any individuals engaged by the firm or a network firm who perform assurance procedures on the engagement. This excludes external experts engaged by the firm or by a network firm. In the case of an audit engagement, the term “engagement team” also excludes individuals within the client’s internal audit function providing direct assistance on the engagement in accordance with ISA 610 (Revised), Using the Work of Internal Auditors.1This exclusion is relevant and applies only where such direct assistance is not prohibited by law or regulation. 1 ISA 610 (Revised) establishes requirements and provides guidance addressing the use of such direct assistance on an audit engagement

  7. Definition of Engagement Team Conclusions of the combined IAASB and IESBA Task Forces Effective Date Proposal in ExposureDraft—Threemonthsafterpublicationofchange Revisedproposal—Sameeffective date as ISA 610 (Revised) whichisproposedtobeforauditsoffinancialstatementsending on or afterDecember 31, 2014

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