1. Achieving Increased Transparency and Global Acceptance Dietz MERTIN Chairman, IFAC International Auditing and Assurance Standards Board Germany

2. XVI World Congress of Accountants 2002 Achieving Increased Transparency and Global Acceptance Dietz Mertin Chairman IAASB

3. IAASB’s world is changing Points to cover: IAASB’s work structure reviewIAASB’s work structure review The ISA global acceptance processThe ISA global acceptance process IAASB’s mid-term agendaIAASB’s mid-term agenda Communication with the Consultative Advisory Group (CAG)Communication with the Consultative Advisory Group (CAG) Partnership with the National Auditing Standard Setters’ networkPartnership with the National Auditing Standard Setters’ network

4. IAASB‘s work structure review From 14 to 18 membersFrom 14 to 18 members First time with 3 non-auditors IAASB‘s meetings open to the publicIAASB‘s meetings open to the public Total agenda material accessible on IFAC‘s websiteTotal agenda material accessible on IFAC‘s website From IAPC to IAASB – International Auditing and Assurance Standards BoardFrom IAPC to IAASB – International Auditing and Assurance Standards Board IAASB staff strengthenedIAASB staff strengthened Strategy ad agenda updatedStrategy ad agenda updated Annual report (first time end of 2002)Annual report (first time end of 2002)

5. The Board member list The Board member list Member body and firm nominees: BrazilAnna Maria Elorietta CanadaDenise Esdon ChinaYang Zhiguo FranceGérard Trémolière Germany (chair)Dietz Mertin ItalyRobert Tizzano JapanGen Ikegami The NetherlandsRoger Dassen Nordic CountriesJan Bo Hansen South AfricaSuresh Kana United KingdomPhilip Ashton John Kellas Ian Plaistowe United StatesJohn Archambault Randy Noonan Non-auditor nominees: Australia (Public Sector): Ian McPhee Australia (Academic) Roger Simnet Canada (User): Denis Desautels

6. The ISA global acceptance process IOSCOIOSCO - is reviewing the existing standards - will recommend certain changes - will finally consider an ISA endorsement EUEU - is planning obligatory use of ISAs from 2005 onwards in Europe World BankWorld Bank - favours a closer link between private and public sector audit procedures Basel CommitteeBasel Committee - close cooperation with IAASB (e.g. IAPS 1004 + 1006)

7. IAASB’s mid-term agenda Complete and updated set of standards until 2005Complete and updated set of standards until 2005 High prioritiesHigh priorities - the “Audit Risk Model” standards - revision of ISA 100 “Assurance Engagements” - “Group Audits” and revision of ISA 600 “Using the Work of Another Auditor” Another Auditor” - “Review of Interim Financial Statements” - revision of ISA 700 “The Auditor’s Report” - revision of ISA 220 “Quality Control” - revision of ISA 240 “Fraud and Error”

8. IAASB’s mid-term agenda, cont. Other prioritiesOther priorities - revision of ISA 620 “Using the Work of an Expert” - revision of ISA 320 “Audit Materiality” - revision of ISA 540 “Audit of Accounting Estimates” - revision of IAPS 1005 “Audit Considerations reg. Small Entities” - “Public and / or Private Offerings” - “Continuous Audit”

9. Communication with the Consultative Advisory Group (CAG) Working relationship review after first 4 yearsWorking relationship review after first 4 years Immediate decisionsImmediate decisions - to review CAG’s terms of reference - 2 instead of 1 meeting each year - to focus the agenda more on IAASB technical issues - to review CAG’s membership to balance geographical spread

10. Communication with the Consultative Advisory Group (CAG), cont. The member listThe member list Association for Investment Management and Research Basel Committee on Banking Supervision Council of the Bars and Law Societies of the EU European Banking Federation European Commission European Federation of Accountants and Auditors for SMEs European Federation of Financial Executives' Institutes European Federation of Investment Funds & Companies European Financial Reporting Group European Savings Banks Group Fédération des Experts Comptables Européens

11. Communication with the Consultative Advisory Group (CAG), cont. Federation of European Stock Exchanges Information Systems Audit and Control Association Institute of Internal Auditors International Accounting Standards Board International Actuarial Association International Association of Insurance Supervisors International Bar Association International Monetary Fund International Organization of Securities Commissions International Organization of Supreme Audit Institutions United Nations Conference on Trade & Development World Bank World Federation of Stock Exchanges

12. Partnership with National Auditing Standard Setters‘ Network Network formation January 2001Network formation January 2001 - worldwide exchange of information on future agenda - first joint projects “Audit Risk Model” and “Fraud” – IAASB and US-ASB Second meeting January 2002Second meeting January 2002 Further joint projects - “Public and / or Private Offerings” – 5 Standard Setters - Revision ISA 320 “Audit Materiality” – IAASB and UK-APB - Revision ISA 540 “Accounting Estimates” – IAASB and UK-APB - “Continuous Audit” – 4 Standard Setters