Page 1 | Proprietary and Copyrighted Information NOCLAR Caroline Gardner, Task Force Chair IESBA Meeting New York April 13-15, 2015
Page 2 | Proprietary and Copyrighted Information Support for direction of proposed Sections 225 and 360 Support in particular for: –Proposed additional guidance and clarification re scope, including scoping out matters that are clearly inconsequential –Placement of third party test –Rebalancing list of factors to consider in determining whether to disclose the matter to an appropriate authority Tentative Board Decisions – January 2015
Page 3 | Proprietary and Copyrighted Information Stakeholder Outreach Q1 2015
Page 4 | Proprietary and Copyrighted Information Main matters raised: –Insider trading scoped in? –Breaches of disclosure requirements under securities laws and regulations covered? –Any requirement to document courses of action considered? –Where client is also an audit client of the firm, requirement to consider communicating the matter to audit engagement partner sounds weak IOSCO Committee 1 – February 4 th
Page 5 | Proprietary and Copyrighted Information Meeting with EC Representatives (February 26 th )
Page 6 | Proprietary and Copyrighted Information Meeting with Monitoring Group (March 5 th )
Page 7 | Proprietary and Copyrighted Information Meeting with IAASB (March 19 th )
Page 8 | Proprietary and Copyrighted Information Meeting with IFAC PAIB Committee (March 23 rd )
Page 9 | Proprietary and Copyrighted Information Broad support for direction and for re-exposure Main matters raised: –Split between assurance and non-assurance engagements? –Insider trading covered? –Sufficiently clear that where there is legal or regulatory requirement to report, PA must comply with it? –Where client is also an audit client of a network firm, requirement to communicate across the network should be same as within the firm –Documentation of significant judgments under proposed Section 225? IESBA CAG Meeting – March 11 th
Page 10 | Proprietary and Copyrighted Information Proposed Sections 225 and 360
Page 11 | Proprietary and Copyrighted Information Proposed Section 225 Changes generally are in response to: –January Board discussion –Input from stakeholder outreach –Feedback from CAG and IFAC SMP Committee Views and comments on proposed changes?
Page 12 | Proprietary and Copyrighted Information Proposed Section 360 Changes generally correspond to changes in proposed Section 225 Views and comments on proposed changes?
Page 13 | Proprietary and Copyrighted Information Consequential and Conforming Amendments Only new proposed changes are in Sections 100 and 140 –100.26: to respond to IFAC SMP Committee comment re in smaller entities, TCWG and management may be the same individual(s) – : to position documentation guidance at broader level of the Code –140.7(c)(iv): refinement re “ethics and professional standards” vs “technical standards and ethics requirements”
Page 14 | Proprietary and Copyrighted Information Draft Explanatory Memorandum Includes: –Outline of developments since August 2012 ED, including extensive outreach –Explanation of approach to, and key elements of, proposed framework –Articulation of strengths of proposed framework –Rationale for not mandating disclosure to an appropriate authority in the Code –A number of messages about broader considerations on the topic –Update on coordination with IAASB Comments?
Page 15 | Proprietary and Copyrighted Information Next Steps TimingAction May 2015Discussion with NSS December Full review of comments on re-ED Discussion with IAASB March 2016Discussion with CAG MarchFinal approval (?)
The Ethics Board