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Standard setting
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Institute submission
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The Institute has submitted its comment letter on the International Accounting Standards Board (IASB) Exposure Draft International Tax Reform—Pillar Two Model Rules (Proposed amendments to IAS 12 Income taxes).
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Last call for the workshops on HKFRS 17 – General Insurance
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Limited seats are still available for the following face-to-face workshops on Hong Kong Financial Reporting Standards (HKFRS) 17 Insurance Contracts:
- 22 March: General Insurance (Part 1): overview and deep dive application
- 29 March: General Insurance (Part 2): reinsurance, interaction with other standards, presentation and disclosures
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IASB concludes project to improve its approach to developing disclosure requirements in IFRS Accounting Standards
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The IASB has published a project summary and feedback statement concluding its project on improving its approach to developing and drafting disclosure requirements. The improved approach is designed to help the IASB develop accounting standards that would enable companies to make better judgements about which information is material and should be disclosed, thereby providing more useful information to investors. The IASB intends to use the improved approach when developing disclosure requirements in the future.
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Invitation to comment
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The Institute is seeking comments on the following issued by the International Auditing and Assurance Standards Board’s (IAASB):
- Exposure Draft on Proposed International Standard on Auditing (ISA) 500 (Revised), Audit Evidence and proposed conforming and consequential amendments to other ISAs by 24 March.
- Exposure Draft on Proposed Part 10, Audits of Group Financial Statements of the Proposed ISA for Audits of Financial Statements of Less Complex Entities (ISA for LCE) and proposed conforming amendments by 2 April.
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HKICPA survey and video on proposed ISA 500 (Revised)
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The Institute is interested in hearing your views about Proposed ISA 500 (Revised), Audit Evidence. To collect these views, you are invited to take a survey which highlights the key attributes of the proposals followed by yes/no questions. The survey takes around twenty minutes to complete and will close on 24 March. Click here to begin the survey.
An introductory video in Cantonese with English terminologies has been produced by the Institute to provide an overview of the proposed changes. Watch the video and view the slide presentation to learn more.
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Training events for auditors
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Don’t miss the following courses that might be relevant to your interest and meet your needs:
- Join the webinar on 17 April in which a speaker from the Insurance Authority will highlight requirements of the Insurance (Financial and Other Requirements for Licensed Insurance Broker Companies) Rules and share regulatory experiences and observations on the reporting by auditors under the Rules. There will be a Q&A session at the end of the seminar to address participants’ questions or comments.
- Join the Institute’s Workshop for Audit Managers/Seniors In-Charge on 2, 5 and 8 May which is tailored for audit managers or seniors in-charge with more than two years of auditing experience. The workshop focuses on advanced auditing topics such as risk assessment procedures, auditing accounting estimates, going concern assessment, and more. It also covers related auditing concepts and practical skills, as well as sharings of recent practice experiences relevant to participants.
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Auditor’s reporting under Product Eco-responsibility (Regulated Articles) Regulation (Cap. 603C)
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The Product Eco-responsibility (Regulated Articles) Regulation (Cap. 603C) will be implemented starting from 1 May 2023. It requires registered suppliers of glass beverage bottles to submit periodic returns to the Environmental Protection Department (EPD) of the HKSAR Government on the bottles they distribute or consume in Hong Kong. It also requires them to engage a CPA (practising) to opine on the periodic returns submitted to the EPD.
The Institute’s Circular on Reporting under Section 20 of the Product Eco-responsibility (Regulated Articles) Regulation (Cap. 603C) aims to provide guidance to practitioners when undertaking such engagements. The Circular was prepared following discussions with the EPD on relevant statutory requirements.
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HKICPA Alerts on auditors-related matters
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The Institute has published the following Alerts which highlight requirements relevant to auditors:
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Implementation of the new quality management standards
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A publication by the European Federation of Accountants and Auditors for small and medium-sized enterprises (EFAA) shares the approach of a small- and medium-sized accountancy practice (SMP) to implementing the new quality management standards, as well as a list of some available electronic implementation tools that might help SMPs.
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IAASB digital technology market scan
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The seventh Market Scan from the IAASB Disruptive Technology team is available. It explores digital assets, with a focus on recent developments within the cryptocurrency market and what it might mean for the audit and assurance ecosystem.
The IAASB’s Market Scans cover exciting trends, including new developments, corporate and start-up innovation, noteworthy investments and what it all might mean for the IAASB. Previous Market Scans covered topics such as data standardization and artificial intelligence, and are available on the IAASB’s technology homepage.
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Sustainability assurance
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The following resources on sustainability assurance might be of interest to auditors:
- An ACCA report about the key challenges currently faced in meeting rapidly increasing demand from investors for delivering sustainability assurance.
- CPA Australia’s Guide on Climate Risk and Audit of Financial Statements provides auditors with the practical step-by-step guidance when performing the audit of financial statements with a focus on climate-related risks and its impact.
- CPA Canada’s The Rise of the Social Pillar: An Introduction to the ‘S’ in ESG examines the growing focus on the “social” pillar of environmental, social and governance (ESG) matters and how professional accountants can lead in this space.
- An EFAA guidance offers suggestions on how SMPs can respond to the rapid emergence of sustainability reporting.
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Invitation to comment
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The Institute is seeking comments on the International Ethics Standards Board for Accountants (IESBA) Exposure Draft Proposed Revisions to the International Code of Ethics for Professional Accountants (Including the International Independence Standards) addressing Tax Planning and Related Services by 18 April. The proposed revisions respond to public interest concerns about tax avoidance and the role played by consultants, including professional tax advisers, in light of revelations in recent years such as the Paradise and Pandora Papers. The proposals strengthen the ethical expectations for professional accountants in business and in public practice when performing tax planning activities for employing organizations or providing tax planning services to clients.
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IESBA Q&A on revisions to the definitions of listed entity and PIE in the Code
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The Staff of the IESBA released a questions and answers (Q&As) publication on the revisions to the definitions of listed entity and public interest entity (PIE) in the International Code of Ethics for Professional Accountants (including International Independence Standards) (the Code). The Q&As highlight, illustrate or explain aspects of the PIE revisions in the Code and is intended to complement the Basis for Conclusions for the final pronouncement. It also assists stakeholders including firms to adopt and/or implement the PIE revisions, and understand the revised PIE definition and related provisions in the Code.
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Seven key takeaways from the IFRS Sustainability Symposium
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Global businesses, investors, policymakers, regulators and other stakeholders engaged in meaningful discussion about the forthcoming standards from the International Sustainability Standards Board (ISSB) in the inaugural IFRS Sustainability Symposium on 17 February. The seven key takeaways from the Symposium are:
- The first two ISSB standards, IFRS S1 General Sustainability-related Disclosure Requirements and IFRS S2 Climate-related Disclosures, are on track to be issued at the end of the second quarter of 2023.
- Sustainability Accounting Standards Board (SASB) Standards are a practical tool to implement S1 and S2.
- Global comparability remains paramount.
- Jurisdictions are actively considering the ISSB Standards.
- Capacity building is critical to the ISSB’s success.
- Work to advance integrated reporting remains underway.
- Many stakeholders have enabled the ISSB to make significant progress.
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