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AASB Decision Summary – July 19, 2022

This summary of decisions of the Auditing and Assurance Standards Board (AASB) has been prepared for information purposes only. Decisions reported are tentative and reflect only the current status of discussions on projects and other matters, which might change after further deliberations by the AASB. Decisions to publish exposure draft and Handbook material are final only after a formal voting process.

Canadian Auditing Standards (CASs)

Listed Entity and Public Interest Entity

The AASB discussed issues related to the International Auditing and Assurance Standards Board’s (IAASB) narrow-scope amendments project to revise the definitions of “listed entity” and “public interest entity”, and other revisions to align with recent changes to the International Ethics Standards Board for Accountants International Code of Ethics for Accountants (including International Independence Standards) (IESBA Code). The AASB discussed:

  • revisions the IAASB made to the proposed changes to International Standard on Auditing (ISA) 700 (Revised), Forming an Opinion and Reporting on Financial Statements, and ISA 260 (Revised), Communication with Those Charged with Governance, in finalizing its Exposure Draft;
  • whether there is a need for Canadian amendments to the wording in ISA 700 (Revised) and ISA 260 (Revised); and
  • issues related to the Canadian exposure draft, including comment period and fatal-flaw review of the French translation.

The AASB approved the exposure draft. The exposure draft is expected to be issued in early August 2022, with a comment deadline of September 16, 2022. 


AASB Engagement Process (AEP)

The AASB discussed its proposed engagement process for identifying and engaging with interested and affected parties on standard-setting projects and other initiatives. The Board discussed the proposed five phases within the AEP and detailed the first two phases. The discussion included:

  • use of the term “interested and affected parties” rather than “stakeholders”; and
  • the process for:
    • determining whether a project is key;
    • identifying interested and affected parties to engage with; and
    • determining the relevant outreach strategy.

Annual Plan

The AASB discussed and revisited its activities in the 2022-2023 annual plan, considering recent changes to staff resources and its Q1 actual activities.

Key Audit Matter Reporting

The AASB received an update on academic research and reviewed an outline of staff communication on the research. Key issues discussed included:

  • the content of the draft staff communication on the research, including the public interest considerations in undertaking the research; and
  • other actions to be undertaken, including follow-up questions for the researchers.