OVERSIGHT PLANS 2015
IAASB
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EXPECTED ACTIVITY
In addition to finalizing the Disclosures project and the revisions to the ISAs 800 standards, according to the new IAASB 2015-2019 Strategy and 2015-2016 Work Plan, during 2015 the IAASB will focus its resources on 3 new, high priority projects:
- Revision of ISA 600, Group Audits
- Quality Control, through the revision of ISQC 1, “Quality Control for Firms that Perform Audits and Reviews of Financial Statements, and Other Assurance and Related Services Engagements”, and, possibly, the revision of ISA 220, “Quality Control for an Audit of Financial Statements”. This project will include consideration of the comments received when the IAASB exposed its the “Framework for Audit Quality” in 2013;
- Special Audit Considerations Relevant to Financial Institutions; and
- Agreed-upon procedures – revision of ISRS 4400 with conforming amendments to other standards as necessary.
In addition to the above, the IAASB will start discussions to consider how best to address the topic of “professional skepticism” and determine how and what efforts may be undertaken on this front, and will consider issues that relate to ISA 315, “Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment”.
The IAASB INFO[1] Working Group1 will focus on 2 topics: Integrated Reporting and Information Technology. This last includes the use of data analytics. The group will also continue to monitoring other emerging areas that may require an IAASB action.
Initially, none of the new projects above will be finalized during 2015.
[1] Innovation, Needs, and Future Opportunities (INFO)
OVERSIGHT MODEL Model 3 (Medium Intensity)
OVERSIGHT ASSURANCE TEAM
| TEAM LEADER | TEAM MEMBER | |
| 2015 | Nic Van der Ende | Jane Diplock Karel Van Hulle Chuck Horstmann |
| 2014 | Rob Ward (until he left the PIOB) | Julie Galbo |
DIRECT OBSERVATION
4/4 Meetings:
March 16-20
June 15-19
September 21-25
December 7-11
CAG MEETINGS
2/2 Meetings:
March 9-10
September 15-16
IESBA
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EXPECTED ACTIVITY
In 2015, the IESBA is expected to finalize two of its top projects “Non-Assurance Services” (NAS) and “Long Association” (LA). The outcome of the three international roundtables held in 2014 on the NOCLAR project, along with the revised framework and provisions, will be discussed and will result in a re-ED, which is planned to be approved in the first quarter of 2015. The other projects, Structure of the Code and Part C of the Code (Phase II), will be further discussed during the year. A new workstream, called “Safeguards”[1], included in the approved 2014-2018 SWP, started to be discussed at the end of 2014 and will be further discussed in the course of 2015.
All these projects are highly relevant from the PIOB’s public interest perspective and will be closely overseen by the PIOB.
The Board will start facing the succession planning of its members. During 2014-2015, 7 members will leave the Board, including task force Chairs and three public members. This “rotation cliff” will affect the functioning of the Board, which will make it even more critical to reach conclusions on pending projects.
The newly appointed IESBA Chair, independent from the profession, will need to lead the IESBA to keep its credibility as an international standard setter.
OVERSIGHT MODEL Model 2 (High Intensity)
OVERSIGHT ASSURANCE TEAM
| TEAM LEADER | TEAM MEMBER | |
| 2015 | Chandu Bhave | Eddy Wymeersch and Jane Diplock |
| 2014 | Eddy Wymeersch | Chandu Bhave and Nic van der Ende |
DIRECT OBSERVATIONS
4/4 Meetings:
January 12-14
April 13-14
June 29-July 1
October 12-14
CAG MEETINGS
2/2 Meetings:
March 10-11
September 14
[1] The aim of the project is reviewing the safeguards throughout the Code from the perspectives of appropriateness and effectiveness, and considering whether changes should be made, including whether additional safeguards should be specified or whether existing safeguards should be removed.
IAESB
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EXPECTED ACTIVITY
According to the IAESB new 2015-2016 Strategy and Work Program, in 2015 the IAESB activity will focus in providing support for the implementation of the revised IESs; maintaining the IESs and considering the need for additional ones; and assessing the impact of the revised IESs. It will also finalize the revision of the Framework and the new definition of Professional Accountant.
In relation to implementation guidance, the top IAESB project in 2015 will be the project on Learning Outcomes, which aims to provide guidance to IFAC member bodies to support the transition in their professional education programs to the outcome-based new approach under the revised IESs, both for Initial Professional Development (IPD) and Continuing Professional Development (CPD) stages.
The IAESB intends to monitoring the work of the IAASB with respect to subjects such as Integrated Reporting, and new standards in the areas suggested by the PIOB to this Board (e.g.; education for auditors of financial institutions and financial instruments; continuing education for professional accountants; and professional skepticism), could be started in the future, depending on the final structure and mandate agreed for the IAESB.
OVERSIGHT MODEL Model 3 (Medium Intensity)
OVERSIGHT ASSURANCE TEAM
| TEAM LEADER | TEAM MEMBER | |
| 2015 | Karel Van Hulle | Jules Muis |
| 2014 | Nic van der Ende | Chandu Bhave |
DIRECT OBSERVATIONS
2/2 Meetings:
April 20-22 - NYC
October 28-30 - NYC
CAG MEETINGS
1/2 Meetings:
February 12-13 - London
CAP
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EXPECTED ACTIVITY
During 2015, according to the postponed Strategy, the CAP will finalize a project to improve the quarterly reports submitted by IFAC member bodies. This is the “Self Assessment Tool and Reports” project, abbreviated as “STAR”, which aims to allow the CAP to better monitoring the level of actual implementation of international standards (according to the SMOs) by IFAC member bodies.
The CAP would be expected to develop its new Strategy in 2015. According to the CAP terms of reference, the CAP should consult the document with the PIOB.
Improvements being introduced to the “dashboard reports” used by CAP staff would be expected to be operative in 2015. These documents are internally used to document the monitoring of compliance by member bodies, and are based on SMO Action Plans (the regular reports submitted by member bodies) and discussions with members.
Finally, the CAP will continue with its other regular activities, including applications for membership with IFAC and enforcement issues (e.g.; suspensions of member bodies, etc.)
A matter that relates to the future of the IAESB is the possibility that the CAP becomes the body responsible for monitoring the implementation of the standards, either as the only body doing so or as co-responsible with the SSBs. This would represent a substantial change in the CAP’s mandate, and something the PIOB will follow during 2015.
During 2015 the PIOB does not expect that the presence of the CAP Chair will be necessary at PIOB meetings, given the limited CAP activity. Instead, whenever the CAP Chair is due to report to the PIOB, communication will be via phone.
OVERSIGHT MODEL Model 3 (Medium Intensity)
OVERSIGHT ASSURANCE TEAM
| TEAM LEADER | TEAM MEMBER | |
| 2015 | Jules Muis | Michael Holm |
| 2014 | Nic van der Ende |
DIRECT OBSERVATIONS
1/4 Meetings:
July 13-14 – NYC
NOMCOM
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EXPECTED ACTIVITY
The PIOB will continue reviewing the CFN and provide comments. Though an approval of the notice CFN is not required, PIOB suggestions are always considered by NC.
During 2015, the NC will follow the process summarized in Appendix II, in order to fill the vacancies at SSBs and CAP, under its oversight. Final nominations, once approved by the IFAC Board, will be submitted for PIOB approval.
Two matters still remain open: the independence of the NC Chair and the definition of Public Member, to respond to the expectations of stakeholders, especially regulators. These topics have been raised at Nom Com meetings, observed by PIOB members, and discussed at PIOB Board meetings with IFAC Leadership. The discussion will continue in 2015.
OVERSIGHT MODEL Model 3 (Medium Intensity)
OVERSIGHT ASSURANCE TEAM
| TEAM LEADER | TEAM MEMBER | |
| 2015 | Maria Helena Pettersson | Michael Holm |
| 2014 | Jane Diplock | Eddy Wymeersch |
DIRECT OBSERVATIONS
5/5 Meetings:
March 30-31
April 23-24
June 24-26
July 9-10
September 9
