In response to amendments made by the IESBA, the IAASB issued a consultation on proposed narrow scope amendments on using the work of external experts.

In joint submission with ACCA, we are supportive of the narrow scope amendments because as the IESBA has already finalised the amendments to the Code of Ethics (IESBA Code), it is in the public interest to ensure that the IAASB Standards are also aligned.

However, we believe that the approach taken in this project is not in the public interest. It would have been preferable for the two boards to co-ordinate the changes using the same timeline, allowing both amendments to the IESBA Code and the IAASB Standards to be considered simultaneously. This would allow any proposed amendments to be fully aligned from the outset. Instead, the IESBA Code amendments have already been finalised and, therefore, irrespective of their context, it is necessary to amend the IAASB Standards to ensure consistency. We had similar concerns with the recent IAASB consultation as a result of the revisions to the definitions of Listed Entity and Public Interest Entity in the IESBA Code. It would be preferable for the IAASB and IESBA to co-ordinate their consultations to allow practitioners to fully consider the changes to the IESBA Code and the consequential impacts on the IAASB Standards.

In addition, as CA ANZ and ACCA raised in our respective responses to the IESBA’s Exposure Draft Using the Work of an External Expert, we have concerns over the potential limited availability of suitable external experts, particularly in smaller or emerging markets. While both CA ANZ and ACCA agreed that ethical requirements should not be reduced based on jurisdiction or materiality, we highlighted the need for the proposed requirements to be practical and manageable for practitioners, audited entities, and the experts themselves.

We also recommended that the IAASB consider extending the proposed application date to allow firms time to implement the changes, and for translations to occur.