Standards digest: accounting and auditing standard-setting in Canada – September 2016

The Public Sector Accounting Board has issued an Invitation to Comment on its strategic plan for 2017-2020. Plus, Eric Turner, director of the AASB, shares some insights on enhancing audit quality in the public interest.

HOT TOPIC                                       

Invitation to comment PSAB draft strategic plan for 2017-2020

The Public Sector Accounting Board (PSAB) issued an Invitation to Comment on our next strategic plan, which outlines our vision, mission, strategic objectives and actions that will guide our standard-setting activities for the next three years.

The past three years were transformational and challenging, with the transition of many government organizations coming into the CPA Canada Public Sector Accounting Handbook, as well as some significant new standards put in place.

During the next three years, the Draft Strategic Plan proposes the following key objectives and activities:

  • finalize the conceptual framework;
  • review our approach to International Public Sector Accounting Standards;
  • encourage stakeholders to support and accept our standards;
  • implement a not-for-profit sector strategy that meets the public interest; and
  • develop standards that support public interest considerations.

Through this Invitation to Comment, we will obtain and analyze your input to make modifications to the Draft Strategic Plan with the aim of finalizing it in time for implementation in April 2017.

Go to www.frascanada.ca/psabdraftstrategicplanand provide us your comments by October 28.

Q&A

Canadians speak out on Enhancing Audit Quality in the Public Interest

Canadian stakeholders voiced their opinion on the International Auditing and Assurance Standards Board’s (IAASB) invitation to comment on Enhancing Audit Quality in the Public Interest, a paper issued for comment last year. It builds on the IAASB’s discussions on professional skepticism, quality control and group audits — and flags potential standard-setting activities the board could take to enhance audit quality.

For Canada’s auditing and assurance Standards Board (AASB), we want to drive home that it’s important to stay up to date and keep the line of dialogue going as key auditing standards get revised.

Q: What did Canadians have to say about this paper?

A: Eric Turner, director, AASB: Canadian responses included firm key messages to the IAASB.

For one, Canadian stakeholders said that auditing standards can better articulate how professional skepticism is described through consistency, and provide guidance on how to demonstrate and document its application.

In addition, stakeholders said that responses by the IAASB regarding issues with standards must be scalable for all audits — including smaller listed entities.

On top of this, Canadian responses noted that, in many cases, requirements to the existing quality control standard are still appropriate today and did not agree with a wholesale change that the IAASB proposed. However, more application guidance would be useful to address new issues.

By contrast, Canadian responses were supportive of the IAASB’s proposal to update the group audit standard. However, the responses emphasized that the standard must remain principles-based to reflect that group structures can vary and evolve over time.

We hope Canadians continue to monitor this topic and be ready to provide their input as key standards are revised. Keep up to date by visiting www.frascanada.ca/AASB.

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