AASB-CBA joint policy statement on communications with law firms

Find out about the joint policy statement from the Auditing and Assurance Standards Board (AASB) and the Canadian Bar Association (CBA) on communications with law firms.

An auditor will often request that management prepare an inquiry letter to send to the entity’s law firm, asking it to confirm the reasonableness of management’s evaluation of the entity’s claims and possible claims. The method by which the auditor and the law firm, together with management, communicate is guided by “The Joint Policy Statements Concerning Communications with Law Firms Regarding Claims and Possible Claims in Connection with the Preparation and Audit of Financial Statements” (JPS).

The AASB and the CBA have undertaken a project to revise the existing JPS to reflect developments in the accounting and auditing standards, and the legal environment, over the 35 years since the JPS was issued.

The Intent of the Revised JPS is to:

  • provide more clarity
  • reflect good practice regarding the auditors’ and law firms’ communications responsibilities

An Exposure Draft proposing a revised JPS is available for comment until April 6, 2015.

About the Author

Svetlana Berger, CPA, CA, MAcc

Principal, Auditing and Assurance Standards, CPA Canada

Highlights

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