IN PRACTICE
In Practice News
In Practice News
CPA Quality Assurance- ISQM Thematic Review 2023
The new Quality Management standards apply from 15 December 2022. These standards will replace the current quality standard upon which the processes and procedures of Irish audit firms are based – International Standard on Quality Control (Ireland) 1 or ISQC1. The standards were issued by the Irish Auditing and Accounting Standards Authority (IAASA) and are based on the global standards issued by the International Auditing and Assurance Standards Board (IAASB). To assist firms with the implementation of same, CPA have launched a Quality Management Resource on the CPA website.

To assess the compliance of CPA audit firms, the Quality Assurance (QA) team will undertake a thematic review of audit firms in Quarter 1, 2023. This review will require a sampling of firms to provide the QA team with their newly implemented Quality Management policies, procedures and risk assessments. This review will be undertaken separate to the standard QA process. Firms in scope for this review, will be notified in January 2023.

Climate-related disclosures in financial reports – IAASA information requests
IAASA, Ireland’s accounting enforcer, has published a paper setting out information requests that it has raised with companies on their climate-related disclosures in their annual financial reports.

The primary purpose of this paper is to provide preparers, auditors and users of financial statements with information to encourage discussion as to whether issuers adequately consider the appropriateness and completeness of climate-related disclosures provided in financial reports.

Given that climate-related matters are of interest to a broad range of stakeholders, IAASA has examined and will continue to examine companies’ financial statements to ensure that there is consistent treatment of climate-related information between the financial statements and information published elsewhere by the issuer (e.g., in the management report, in market announcements and in separate sustainability reports).

This paper lists climate-related information requests that IAASA has made to companies in its 2022 cycle of financial statement examinations. Consideration by companies as to how they might respond to such questioning may assist them in providing high quality information to users of their financial reports.

The paper is available on IAASA’s website. www.iaasa.ie

Final Year of 3-year CPD Cycle
CPA members are reminded that 2022 is the final year of a three-year CPD cycle. The new three-year CPD cycle will commence on 1 January 2023.

The annual renewal of practising certificates is reliant on compliance with CPD requirements. Members in Practice and Members working in Professional Offices are required to complete 120 hours over a three-year CPD cycle of which 75 hours are structured and 45 hours are unstructured CPD.

A minimum of 30 hours should be completed in any one year, of which 15 hours have to be structured training.

40 hours of the 75 structured CPD hours must be completed from any combination of the following six areas over a three year CPD cycle:

  • Financial Accounting
  • Auditing
  • Law & Regulation
  • Taxation
  • Professional Ethics
  • Practice Management

From 1 January 2023 statutory auditors must complete 20 hours of this 40 hour core competency requirement in the following areas;

  • Auditing
  • Financial Reporting
  • Law and Regulation
Updates to the International Standards on Auditing (Ireland)
ISA (Ireland) 315 (Revised October 2020), Identifying and Assessing the Risks of Material Misstatement, is effective for audits of financial statements beginning on or after 15 December 2021.

20 ISAs (Ireland) have been updated to reflect the conforming amendments required due to the adoption of ISA (Ireland) 315 (Revised October 2020). A complete list of the updated standards is available on IAASA’s website.

The revised ISA (Ireland) 315 requires more robust risk identification and assessment. The significant changes include:

  • Separate assessment of inherent risk and control risk
  • Spectrum of inherent risk-used for assessment of inherent risk and the risk of material misstatement at the assertion level
  • Enhanced requirements on the exercise of professional scepticism
  • More requirements related to gaining an understanding of the entity’s IT environment, including risk identification and assessment

www.iaasa.ie

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