1. Page 1 | Proprietary and Copyrighted Information Emerging Issues and Outreach Reyaz Mihular, Chair Emerging Issues and Outreach Committee IESBA Board Meeting October 13-15, 2015 New York

2. Page 2 | Proprietary and Copyrighted Information Global Adoption of the Code April Board meeting –Good first step – especially for G-20 Countries –Snap shot in time –Disparate nature of adoption –Responsibility for overseeing adoption

3. Page 3 | Proprietary and Copyrighted Information Global Adoption of the Code September CAG meeting –How categories of adoption defined? –Measurement of adoption can be resource intensive –How do jurisdictions adopt latest changes? –Understand nature and extent of differences –Highest standard vs. lowest common denominator?

4. Page 4 | Proprietary and Copyrighted Information International Forum of Independent Audit Regulators (IFIAR) Inspection Reports Main findings: –Audit of listed PIEs: fair value measurements; internal control testing; adequacy of financial statements –Audits of SIFIs and G-SIBs: loan losses and impairments; control testing; valuation of investment and securities –Quality control systems: engagement performance; human resources; ethics and independence

5. Page 5 | Proprietary and Copyrighted Information International Forum of Independent Audit Regulators (IFIAR) Inspection Reports Matters pertaining to independence: –Engagement quality control reviews –Independence considerations –Provisions / reserves Inspection findings – targeted actions to improve audit quality Greater liaison with IFIAR

6. Page 6 | Proprietary and Copyrighted Information UK Financial Reporting Council (FRC) Inspection Reports Key areas needing improvement: –Focus on audit quality –Need to maintain professional skepticism –Audits of financial services entities –Group audits –Independence and Ethics – boiler plate approach –Audit quality monitoring

7. Page 7 | Proprietary and Copyrighted Information UK Financial Reporting Council (FRC) Inspection Reports Independence: –Good standard of independence from auditors Ethics –NAS selling targets in partner appraisals –Contingent fee arrangements on tax services –Rotation of KAPs from other network firms –Disposal of shareholdings in audited entities

8. Page 8 | Proprietary and Copyrighted Information Canadian Public Accountability Board (CPAB) Inspection Reports Main findings: –Trend in audit quality is positive –Challenge to improve audit quality being taken seriously –Improvement due to action plans –Concerns over overseas audits –TCWG should discuss audit quality with auditors

9. Page 9 | Proprietary and Copyrighted Information Other Matters EU Audit Reform –Liesbet Haustermans Outreach

10. The Ethics Board www.ethicsboard.org