IAASB: the evolving nature of financial reporting: disclosure and its audit implications

Comments from ACCA to the International Auditing and Assurance Standards Board, (IAASB), June 2011.

A discussion paper issued for comment by the International Auditing and Assurance Standards Board Comments from ACCA June 2011

ACCA welcomes the opportunity to respond to the discussion paper The Evolving Nature of Financial Reporting: Disclosure and Its Audit Implications issued by the International Auditing and Assurance Standards Board (IAASB). The paper is intended to inform decisions about whether and to what extent additional standards or guidance are needed.

This is an excellent paper that lays bare the potential difficulties arising from the increase in length and complexity of financial statements disclosures and the move towards providing information traditionally seen as outside the boundaries of financial statements.

The paper calls for views from four primary viewpoints (preparers, users, regulators and auditors). By virtue of ACCA's diverse membership and our role as regulators of auditors, our response addresses all these perspectives.

For disclosures, we are generally content with the requirements and guidance for auditors in the existing International Standards on Auditing.

Nevertheless, we identify an opportunity for the IAASB to provide information to diminish any gap that arises between user expectation of auditors and what auditors actually do in relation to disclosures.

We also refer to our earlier published research and position papers and reiterate our view that audit needs to be broadened in scope so auditors can better meet legitimate user needs.