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04 March 2011

Korrekturhinweis: APB Ethische Standards


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The Auditing Practices Board of the FRC corrected typographical errors in two of the Ethical Standards for Auditors which were published on the website on 17th December 2010. Paragraph 96 of ES 5 (Revised) and paragraph 25 of ES – PASE (Revised) have now been corrected.


Current language and corrected language is shown below:
 
Paragraph 96, ES 5 (Revised) originally read: Where tax services, such as advising on corporate structures and structuring transactions to achieve a particular effect, are undertaken on a contingent fee basis, self-interest threats to the auditor’s objectivity and independence may arise. The auditor may have, or may appear to have, an interest in the success of the tax services, causing the audit firm to make an audit judgment about which there is reasonable doubt as to its appropriateness. Where the contingent fee is determined by the outcome of the application of tax law, which is uncertain or has not been established, and where the tax implications are material to the financial statements, the self-interest threat cannot be eliminated or reduced to an acceptable level by the application of any safeguards.

The corrected version reads: Where tax services, such as advising on corporate structures and structuring transactions to achieve a particular effect, are undertaken on a contingent fee basis, self-interest threats to the auditor’s objectivity and independence may arise. The auditor may have, or may appear to have, an interest in the success of the tax services, causing the audit firm to make an audit judgment about which there is reasonable doubt as to its appropriateness. Where the contingent fee is determined by the outcome of the application of tax law which is uncertain or has not been established, the self-interest threat cannot be eliminated or reduced to an acceptable level by the application of any safeguards.

Paragraph 25, ES – PASE (Revised) originally read: The fact that an audit firm has taken advantage of an exemption from APB Ethical Standard – Provisions Available for Small Entities is set out in a separate paragraph of the audit report as part of the Basis of audit opinion. It does not affect the Opinion paragraph. An illustrative example of such disclosure is set out in the Appendix.

The corrected version reads: The fact that an audit firm has taken advantage of an exemption from APB Ethical Standard – Provisions Available for Small Entities is set out in the auditor’s report as part of the auditor’s responsibilities paragraph. It does not affect the Opinion paragraph. An illustrative example of such disclosure is set out in the Appendix.

Press release


© FRC


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