Technical resource centre

Welcome to the Chartered Accountants Ireland's Technical Resource Centre. This resource area is aimed at keeping members up to date with the latest technical news and helpful resources to keep them abreast of current developments worldwide. There is also a link to our Technical Enquiry Service in contacts and support.

Latest news

UK  A new report from the Financial Reporting Lab of the UK Financial Reporting Council (FRC) reveals that reporting on work­force-re­lated issues needs to improve to meet investor needs. David Styles, Director of Corporate Governance, talks via video link about the key highlights of the Annual Review of the UK Corporate Governance Code, which was published earlier this month. International The Trustees of the IFRS Foun­da­tion have announced the ap­point­ment of Bruce Mackenzie as IASB Board member. The International Fed­er­a­tion of Ac­coun­tants (IFAC), the As­so­ci­a­tion of Chartered Certified Ac­coun­tants (ACCA), the Institute of Chartered Ac­coun­tants of Scotland (ICAS), the Chartered Ac­coun­tants Australia and New Zealand (CA ANZ), the International In­te­grated Reporting Council (IIRC) and the World Bench­mark­ing Alliance have jointly published a report calling for improved UN Sus­tain­able De­vel­op­ment Goals (SDG) dis­clo­sures.  

Jan 23, 2020

Republic of Ireland  The Central Bank of Ireland has this week published the “Peer Review: Central Bank of Ireland’s Performance of its Regulatory Functions in Relation to Credit Unions”. The Review, undertaken by an external and experienced team of international regulatory experts from the International Credit Union Regulators’ Network (ICURN) has found that the Central Bank effectively performs its functions in the regulation and supervision of the credit union sector. IAASA has recently published summary information of its financial reporting enforcement activities undertaken during 2019. UK The FRC has released 8 updated ISAs (UK) with an effective date of 15 December 2019, amended to include conforming amendments arising from the revision of ISA (UK) 540 (Revised) – Auditing Accounting Estimates and Related Disclosures. European  ESMA has published the responses received to its consultation on MiFID II review report on position limits and position management.          

Jan 16, 2020

Northern Ireland  The Charity Commission for Northern Ireland is this week issuing letters to over 8,800 charity trustees to remind them their charity’s annual return is due for submission this month.  UK  Companies need to improve their governance practices and reporting if they are to demonstrate their positive impact on the economy and wider society, according to a new report from the FRC. The Financial Conduct Authority (FCA) and the Bank of England have this week outlined their plans to develop their data and analytics capabilities. Both authorities depend on access to high-quality data to fulfil their respective missions of maintaining monetary and financial stability, market integrity, effective competition and consumer protection. European  Accountancy Europe have just issued their January 2020 newsletter which includes recent publications and upcoming events. Accountancy Europe have just issued their Audit Policy Update which features an interview with Christian Orth, newly appointed Chair of the Audit & Assurance Policy.  International In 2020, the IASB plans to publish a number of con­sul­ta­tion documents, including a dis­cus­sion paper on goodwill and im­pair­ment, an exposure draft in its man­age­ment com­men­tary (wider corporate reporting) project, and a request for in­for­ma­tion regarding the 2020 Agenda con­sul­ta­tion.

Jan 09, 2020

UK  The Financial Reporting Council (FRC) has issued an update of its Practice Aid to assist audit committees in evaluating audit quality in their assessment of the effectiveness of the external audit process. Europe The European Securities and Markets Authority (ESMA) has published its thematic report on the implementation of ESMA’s Guidelines on Alternative Performance Measures (ESMA APM Guidelines). Ac­coun­tancy Europe has published a paper de­scrib­ing and calling for a global solution to in­ter­con­nected stan­dard-set­ting that can meet the need for reliable, con­sis­tent in­for­ma­tion in non-fi­nan­cial reporting that is in­ter­con­nected with financial reporting. International The International Auditing and Assurance Standards Board (IAASB) has released a Feedback Statement sharing what the Board has heard regarding audits of less complex entities in response of its recent Discussion Paper: Audits of Less Complex Entities (LCEs): Exploring Possible Options to Address the Challenges in Applying the ISAs. The IAASB has issued ISA 315 (Revised 2019), Identifying and Assessing the Risks of Material Misstatement, which has been revised to include a more robust and consistent risk identification and assessment. The IFRS December news update has been published.  

Jan 02, 2020
Audit

Exactly one year to the day after his review was announced, and available a couple of weeks earlier than anticipated, Sir Donald Brydon has published his report into the quality and effectiveness of audit. The report, which the UK Government commissioned, looks at the provision of audit services to UK Public Interest Entities, acknowledging that it could impact on the services provided by auditors beyond the UK. In June 2019, Chartered Accountants Ireland responded to the consultation with a lengthy submission. We had previously engaged with the other two key consultations/studies relating to the UK audit sector, namely the CMA’s Statutory Audit Services Market Study and the Independent Review of the Financial Reporting Council by Sir John Kingman.    The recommendations in the newly published report warrant careful consideration as they propose some radical shifts for both the auditing profession and the directors of businesses in the UK.  The recommendations include: A redefinition of audit and its purpose; The creation of a corporate auditing profession governed by principles; The introduction of suspicion into the qualities of auditing; The extension of the concept of auditing to areas beyond financial statements; Mechanisms to encourage greater engagement of shareholders with audit and auditors; A change to the language of the opinion given by auditors; The introduction of a corporate Audit and Assurance Policy, a Resilience Statement and a Public Interest Statement; Suggestions to inform the work of BEIS on internal controls and improve clarity on capital maintenance; Greater clarity around the role of the audit committee; A package of measures around fraud detection and prevention; Improved auditor communication and transparency; Obligations to acknowledge external signals of concern; Extension of audit to new areas including Alternative Performance Measures; and The increased use of technology. The report states very clearly that the directors have a role to play in corporate reporting.  We welcome the recommendation that the board should have enhanced responsibilities regarding the viability of the company and should produce a Resilience Statement that builds on the current going concern and viability statements. The report recommends the consideration of an internal controls review along the lines of the US SOX reports. In our letter we advised caution regarding this and that further work/evidence is required to justify the introduction of such a costly regime. In our response to the consultation we commented that the developments in auditor reporting in recent years have been very beneficial.  The introduction of commentary on ‘key audit matters’ (KAM) and discussion of materiality issues provides rich information for users of financial statements and that   this could be further developed by auditors commenting on KAMs year on year.  We are pleased to note that the report recommends such follow up. Audit fees will be more upfront in the financial statements and audit firms will be required to publish the profitability of their work from audit. They will also be asked to disclose, “within the audit report, the hours spend on each audit by each grade within the audit team”. This can only lead to much lengthier reports. In addition, it is proposed that auditors are given the freedom to include a wider range of material in their report as they feel appropriate. This will be a significant change for the current reporting and would rely heavily on the professional judgement of the auditor. Sir Donald Brydon stated “I recommend that auditors should be free to include original information, materially useful to a wide range of users, in their audit report and at the AGM, and not be confined to commenting on that which has already been stated by directors.” We look forward to the discussions and debates that this report will no doubt generate and we will be publishing commentary and further analysis in 2020.    

Dec 20, 2019

Chartered Accountants Ireland  The report of the independent review into the quality and effectiveness of audit has just been published. We will be issuing commentary and further analysis on this report in 2020. ROI  The Central Bank of Ireland has published its sixth issue of the report on the financial conditions of the credit union sector.  UK  The FRC has announced its 2020/21 corporate reporting and audit quality review programme. The FRC has welcomed new guidance issued by the Taskforce on Disclosures about Expected Credit Losses (DECL).  The FRC has issued FRED 73 Draft amendments to FRS 101 – 2019/20 cycle. The Institute is considering whether a submission will be made by the deadline of 16 March 2020. To support the delivery of high-quality audit in the UK, the FRC has issued a major revisions to its Ethical Standard and revised Auditing Standards. The FRC has issued Amendments to FRS 102 - Interest rate benchmark reform, which responds to a current financial reporting issue.  The FRC issued a letter to the heads of audit of the larger audit firms in early November intending to share experience from the audit quality review inspections and root cause analysis performed by audit firms on aspects of the audit process that are likely to affect the quality of audits. International The International Auditing and Assurance Standards Board (IAASB) has released a Feedback Statement sharing what the Board has heard regarding audits of less complex entities in response of its recent Discussion Paper: Audits of Less Complex Entities (LCEs): Exploring Possible Options to Address the Challenges in Applying the ISAs.      

Dec 19, 2019
Insolvency and Corporate Recovery

We wish to remind members of the obligation to file beneficial ownership information with the Central Register of Beneficial Ownership of Companies and Industrial & Provident Societies (RBO).  The Insolvency Committee of the Consultative Committee of Accountancy Bodies - Ireland (CCAB-I) is currently preparing a guidance paper which will discuss the implications of the RBO on insolvency practitioners.  The Insolvency Committee is currently liaising with the relevant parties prior to publishing this guidance paper. It is noted that insolvency practitioners should consider whether the RBO has been complied with for appointments after 22 November 2019 and you may consider including some relevant wording regarding same in your letter of engagement.

Dec 13, 2019

ROI  SI No 597 of 2019 European Union (Qualifying Partnerships: Accounting and Auditing) Regulations 2019 has been issued.  A copy of the Regulations are available on the DBEI website, which notes that these Regulations give effect to the transposed provisions of Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings (the Accounting Directive) in respect of partnerships and limited partnerships where Article 1(1)(b) of that Directive requires it. The Insolvency Committee of the Consultative Committee of Accountancy Bodies - Ireland (CCAB-I) is currently preparing a guidance paper which will discuss the implications of the RBO on insolvency practitioners.  The Insolvency Committee is currently liaising with the relevant parties prior to publishing this guidance paper.   Europe EFRAG has shared the video recordings of its November Conference: IFRS & Regulation: Searching for Common Ground. In two parts you can watch the keynote speeches provided by Michel Prada and Steven Maijoor, followed by two thought-provoking panel discussions.  EFRAG has published its feedback statement to the IASB ED/2019/4 Amendments to IFRS 17. International Vice-Chair of the International Accounting Standards Board Sue Lloyd delivered a speech at the 9 December annual conference in Washington on regulatory developments organised by the American Institute of Certified Public Accountants.

Dec 12, 2019

ROI The Pensions Authority have published a guidance note on the European Union (Supplementary Pension Rights) Regulations 2019 (S.I. No. 447 of 2019). These Regulations bring certain provisions of Directive 2014/50/EU (the Portability Directive) into force from 13 September 2019. UK  Client Asset Assurance Standard - the Financial Reporting Council (FRC) has this week issued a revised standard for the audit of client assets. Europe  The November EFRAG Update has just been issued – it is published on a monthly basis to inform constituents about due process publications, public technical discussions held and decisions taken during that month. The Committee of European Auditing Oversight Bodies has issued ‘CEAOB guidelines on the auditors’ involvement on financial statements in European Single Electronic Format’. International As the UN Climate Change Conference (COP) meets this week, IFAC urges decisive action to put the world on a path to a sustainable future. To clearly articulate the role of the global accounting profession in addressing the climate emergency, IFAC published its Point of View on climate action. The IFRS November Update has just been issued which contains a summary of news and events over the past month.  

Dec 05, 2019