Recent blogs have dealt with some of the changes to the Ethical Standard for Auditors and to ISQC1 some important changes have occurred. We wrote on:
- 2 November 2021 Do you know your RITP from your IES 8? about the measure of independence of the audit team and the ongoing CPD requirements for Audit Engagement Partners.
- 9 November 2021 The Auditor as Referee about the annual self-reporting of ethical breaches by audit firms.
- This week we want to highlight two more important changes to Section 5 of the Ethical Standard dealing with certain Non-Audit Services which are banned from 15 July 2021. These changes apply to all audits, both private and listed entities. These changes came into effect from 15 July 2021. The words in bold are what’s new since the 2017 version
- Recruitment ban: Paragraphs 5.94 and 5.95 now state:
5.94 ‘The firm shall not provide recruitment services to an entity relevant to an engagement, that would involve the firm taking responsibility for, or advising on the appointment of any director or employee of the entity, or a significant affiliate of such an entity, where the firm is undertaking an engagement.’
5.95 ‘The firm shall not provide advice on the remuneration package or the measurement criteria on which the remuneration is calculated, for any director or employee of the entity, or a significant affiliate of an entity relevant to an engagement.’
Prior to this ban, recruitment could have been carried out in certain limited circumstances and within certain safeguards being implemented.
- Internal audit ban: Paragraph 5.48 now states ‘The firm shall not provide internal audit services to an entity relevant to an engagement or a significant affiliate of such an entity, where the firm is undertaking an engagement’.
Prior to this ban being introduced, the 2017 version of the Ethical Standard for Auditors, internal audit services were permitted in certain circumstances, while other internal audit services were not. Now the ban is across the board.
Prior to this ban being introduced, the 2017 version of the Ethical Standard for Auditors, internal audit services were permitted in certain circumstances, while other internal audit services were not. Now the ban is across the board.
For more details and implementation support on these changes, please refer to our just published Audit Quality Control Manual (implementing the latest Irish Audit & Accounting Supervisory Authority standards including ISQC1 on audit quality control). View the Table of Contents here.
We also have an up to date Anti-Money Laundering Procedures Manual (September 2021) – View the Table of Contents here.
