The International Auditing and Assurance Standards Board is seeking views on developing fair value auditing guidance for a new consultation paper.

The paper, entitled “Auditing Complex Financial Instruments,” comes in response to strong demand from auditors and preparers for further guidance on auditing complex financial instruments, especially in illiquid markets.

“The current economic environment has given rise to particular issues relating to the reliability and auditability of fair value information,” said IAASB Chairman Arnold Schilder in a statement. “This consultation addresses these issues and solicits discussions. The IAASB intends to use the feedback from the consultation in the revision of its Practice Statement 1012 on auditing derivative financial instruments.”

The draft consultation paper incorporates recent work by the U.K. Auditing Practices Board on the same topic, and asks questions about how that guidance might be adapted or supplemented for application in the international context.The IAASB operates under the auspices of the International Federation of Accountants.

The paper is available at www.ifac.org/Guidance/EXD-Outstanding.php. Comments can be submitted electronically via the "Submit a Comment" link on the Exposure Drafts and Consultation Papers page on the IFAC Web site or by e-mailing edcomments@ifac.org. Comments are due Jan. 15.

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