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Since our last update in February, the AUASB has finalised some significant developments focused on the Not-for-Profit sector, issuing a new AUASB Bulletin Auditing Fundraising Revenue of Not-for-Profit Entities in a Digital Age and withdrawing Guidance Statement GS 019 Auditing Fundraising Revenue of Not-for-Profit Entities. The recent pandemic accelerated the use of digital technologies and transition from traditional fundraising techniques to online platforms across the Not-for-Profit (NFP) sector. This new Bulletin and the associated practice aids we have produced to accompany this publication will aid auditors of NFPs in managing the impact of technology on internal operations and the audit process.

Last month, I also had the opportunity to share my perspective on how global developments in assurance standards may impact the sustainability reporting landscape during a joint event hosted by CPA Australia and the APESB on Global Developments in Ethics and Assurance for Sustainability. The AUASB has also, in the last week, issued a third Sustainability Assurance Update, which aims to inform stakeholders on developments in sustainability assurance.

This Newsletter also includes two AUASB projects targeted at the public sector - the revision of GS 023 and the Post Implementation Review (PIR) of ASAE 3500 Performance Engagements, which we are currently seeking feedback on, and links to recent AUASB submissions to the IAASB.

As always, we welcome your comments on any of the items included in this edition of the AUASB’s Newsletter and would be happy to hear about any other areas you believe the AUASB should be addressing.  

Regards,

Bill

AUASB Board Meetings:

Highlights from the March 2023 AUASB Meeting are available to read.

The next AUASB meeting will be held virtually on 2 May 2023.

Latest News

Sustainability Assurance Update

This Sustainability Assurance publication, prepared by AUASB staff, is the third in a series, with the first update issued in October 2022 and the second update issued in February 2023. This publication is more technical in nature than the previous publications and provides an update as to key advancements in the IAASB’s Proposed International Standard on Sustainability Assurance (ISSA) 5000.

Importantly, the IAASB intends to issue the Exposure Draft of Proposed ISSA 5000 in the second half of 2023. The AUASB plans to conduct extensive outreach during the exposure period to ensure Australian feedback on the IAASB Exposure Draft is captured and shared with the IAASB. The IAASB has targeted approval of a final standard in the second half of 2024.

AUASB Issues Bulletin Auditing Fundraising Revenue of Not-for-Profit Entities in a Digital Age to update and replace content in GS 019

The AUASB has approved the withdrawal of GS 019 Auditing Fundraising Revenue of Not-for-Profit Entities at the March 2023 AUASB meeting and issued an AUASB Bulletin Auditing Fundraising Revenue of Not-for-Profit Entities in a Digital Age to update and replace the content in GS 019.

The purpose of this Bulletin is to assist auditors to address key audit considerations in a digital age when undertaking their planning, risk assessment, performing and reporting on fundraising revenue. This AUASB Bulletin highlights current issues relating to fundraising revenue collection and the impacts of the collection on audit procedures and the audit report. It also draws together other reference materials from the AUASB and other sources that auditors of NFPs may find useful.  

If there are any concerns with the withdrawal of GS 019 Auditing Fundraising Revenue of Not-for-Profit Entities kindly contact us via enquiries@auasb.gov.au by 5 May 2023.  

Post Implementation Review of ASAE 3500 Performance Engagements

The objective of the Post Implementation Review (PIR) is to:

• gather information about the implementation and application of ASAE 3500, which was revised and reissued by the AUASB in October 2017; and
• evaluate the overall effectiveness and efficiency of the Standard in meeting its original objectives, including whether the Standard remains appropriate.

The Project Plan for the PIR provides further details on the project.

If you have any relevant feedback on the application of ASAE 3500, the AUASB would appreciate hearing your views. We are particularly interested in getting your feedback in response to the following PIR Questions. Please contact Johanna Foyster to share your insights, or send a submission to enquiries@auasb.gov.au, by 28 April 2023.

Read more here. 

AASB-AUASB Dialogue Series – Navigating Going Concern Disclosures in Financial Reports and the Relevant Auditor's Responsibilities

Why are going concern disclosures important? Are current going concern disclosures in financial reports sufficient? What recent concerns have arisen regarding the relevant accounting and auditing standards? Why is the auditing standard being revised? These critical questions will be the focus of discussion at the upcoming Dialogue Series session. 

The AASB and AUASB, jointly with CPA Australia and CA ANZ will hold a Dialogue Series on Wednesday, 10 May 2023 (4:00 PM-5:30 PM AEST) to discuss issues related to going concern disclosures and auditing. Associate Professor Brad Potter (University of Melbourne) and Rebecca Mattocks (PhD candidate of Monash University) will present their relevant research findings.  

Further, the panel discussion will feature Anne Waters (Deputy Technical Director of AUASB) and Toby Langley (EGM - Customer and Strategic Finance, Xero), offering their distinct perspectives. The session will be chaired by Amir Ghandar (Reporting and Assurance Leader at CA ANZ). 

Read more here.   

Please register via this link. 

AUASB Issues an Updated Version of AUASB Guidance Statement GS 023 to Support Public Sector Auditors in Applying Auditing Standard ASA 220

The AUASB has released an updated version of Guidance Statement GS 023 Special Considerations – Public Sector Engagements, which includes additional explanatory and application material to support public sector auditors in applying Auditing Standard ASA 220 Quality Management for an Audit of a Financial Report and Other Historical Financial Information to public sector engagements. GS 023 is to be read and applied together with ASA 220.

GS 023 was initially issued by the AUASB in December 2021 to promote consistent application of AUASB Standards in the public sector and enhance the quality of public sector audits and assurance engagements. GS 023 has been designed to be incrementally updated to include topic specific guidance material in response to issues identified in applying AUASB Standards in the public sector. The updated GS 023 provides supplementary guidance to apply the ASA 220 concept of ‘Engagement Partner’ in the public sector context.

Read more here. 

AUASB issues ASA 2023-1 Amendments to Australian Auditing Standards

The Australian Accounting Standards Board (AASB) issued AASB 2021-2 Amendments to Australian Accounting Standards – Disclosure of Accounting Policies and Definition of Accounting Estimates in March 2021, which made amendments to AASB 101 Presentation of Financial Statements to require entities to disclose their material accounting policy information rather than their significant accounting policies.

Consequently, the AUASB has identified numerous illustrative auditor’s reports and engagement letters in the suite of AUASB Standards that are impacted by these amendments. At the March 2023 AUASB meeting, the AUASB approved to issue ASA 2023-1 Amendments to Australian Auditing Standards which made amendments to 11 auditing standards comprising of:

• Changes arising from narrow-scope amendments made by the AASB to AASB 101 Presentation of Financial Statements;
• Changes to ASA 102 Compliance with Ethical Requirements when Performing Audits, Reviews and Other Assurance Engagements arising from amendments made by the Accounting Professional & Ethical Standards Board (APESB) to APES 110 Code of Ethics for Professional Accountants (including Independence Standards); and
• Minor editorial corrections.

The amendments are operative for financial reporting periods commencing on or after 1 January 2023. The AUASB will update the revised standards in the AUASB Digital Portal in due course, watch this space for future updates.

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