2021 has been a busy year on the technical front, with changes to auditing standards, AML legislation and ethical requirements to highlight just some of the changes. We have gathered the technical highlights from 2021 below.
Auditing Standards
Revisions to ISA (Ireland) 540, Auditing Accounting Estimates and Related Disclosures and ISA (Ireland) 570, Going Concern, had significant impacts on the audit process for the audits of financial statements with a 31st December 2020 year end.
Revisions to ISA 540 now require the auditor to perform additional risk assessment procedures over accounting estimates and to apply a more robust and challenging approach to these estimates. An article in June’s
Accountancy Plus explored these changes.
Similarly, revised ISA 570 required a more robust questioning approach to the matter of going concern, made all the more challenging in the midst of the COVID-19 pandemic and its impact on business. An article in March’s
Accountancy Plus detailed the changes.
A range of webinars on these topics can be found
here.
The CPA Clarified Audit Procedures programme has been updated to reflect these changes and is available to purchase here.
Ethical Standards for Auditors
The Ethical Standard for Auditors (Ireland) 2020 became effective on the 15th July 2021.
The standard included a new requirement for audit firms to make reports of breaches of the Ethical Standard to the relevant competent authority (CPA Ireland for CPA audit firms) and now explicitly prescribes reporting of breaches to those charged with governance. For guidance on this reporting requirement click
here.
Engagements to provide previously non-prohibited non-audit services, entered into before 15 July 2021, and for which the firm has already commenced work may continue until completed in accordance with the original engagement terms, subject to the application of appropriate safeguards.
For key details of the changes please click
here.
For details of a webinar exploring the changes click
here.
AML Legislation
The Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2021 (“Act”) was signed into law on 18 March 2021. A commencement order has now enacted all the provisions of the Act. Further, a second order enacted provisions for disclosure of beneficial ownership of trusts and a central register for beneficial ownership of trusts.
The purpose of the new legislation is to give further effect to domestic obligations under the Fifth Anti Money Laundering Directive. The aim of the directive was to respond to evolving trends in terrorism financing and beneficial ownership transparency. The legislation also provides for related matters. To read this please click
here.
For a summary of the changes please click
here.