The International Ethics Standards Board for Accountants has revised its ethics code to improve the independence provisions for auditors.
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“Auditor independence is foundational to public trust in the external audit,” said IESBA chairman Dr. Stavros Thomadakis in a statement. “These enhancements will not only further reinforce independence but also promote greater consistency of application of the code’s provisions in the 100-plus jurisdictions around the world where the code is currently in use.”
IESBA operates under the auspices of the International Federation of Accountants. The revisions to IESBA’s ethics code include the removal of provisions that permitted an audit firm to provide certain bookkeeping and taxation services to public interest entity, or PIE, audit clients in emergency situations, as these were susceptible to being interpreted too generally. In addition, the revised provisions include new and clarified guidance regarding what constitutes management responsibility; and clarified guidance regarding the concept of “routine or mechanical” services relating to the preparation of accounting records and financial statements for audit clients that are not PIEs.
The revisions also include corresponding changes to the code’s non-assurance services provisions with respect to other assurance clients.
“These changes focus on a few select, but important, areas of the code,” said IESBA technical director Ken Siong in a statement. “Nonetheless, the board continues to explore other areas where there may be a need for further enhancement. In this regard, the board has recently launched a new project that will review the clarity, appropriateness, and effectiveness of the safeguards against threats to auditor independence in the code, particularly as these relate to the provision of non-assurance services to audit clients.”
To access the revised pronouncement, visit the IESBA site at
