ACCA welcomes the opportunity to provide feedback on the ISA (UK) 240 The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements and ISA (UK) 570 Going Concern – Consultation on proposed revisions.

ISA (UK) 240 The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements and ISA (UK) 570 Going Concern

We agree with the FRCs proposal to converge ISA (UK) 240 The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements and ISA (UK) 570 Going Concern with the international equivalent standards. Convergence of international and national standards enhances audit quality and uniformity of practice throughout the world and strengthens public confidence in the global auditing and assurance profession. While we recognise the mobility of audit talent in general will be positively impacted easing the critical shortage of audit talent, globally consistent standards lead to consistent audit methodologies, which in turn, facilitate staff training and enhance mobility. We also commend the FRCs work to identify and propose removal of duplication in the standards including the removal of UK ISA pluses where appropriate and improving guidance, where possible.

ISA (UK) 240 The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements

We note that key audit matters related to fraud, as communicated to those charged with governance, should be considered for disclosure in the auditor’s report under the proposals. ACCA support the intention of providing additional transparency in the auditor’s report to address stakeholders’ requests for more transparency in this important area, we recommend a post-implementation review is conducted at an appropriate time. We continue to support the prioritisation and continuous review of this area by the FRC on an ongoing basis. This will be important to identify the effectiveness of these updates in addressing stakeholder concerns including reviewing evidence of any legal liability challenges faced by practitioners and their clients arising from these disclosures.

We are pleased to see the inclusion of application material in relation to leveraging technology to enhance the quality of fraud related procedures and encourage the FRC to review this on a regular basis.

To read our comments in full, please download the document found on this page.