A message from our Chair
I am proud to reflect on the progress made by the Auditing and Assurance Standards Board (AASB) in advancing our strategic initiatives over the past year.
Grounded in our 2022-2025 Strategic Plan and our commitment to the public interest, our activities have been focused on understanding, responding to, and supporting the needs of interested and affected parties in Canada across six key strategic directions. This past year has been a busy one; we had in-depth board discussions on seven separate projects, conducted outreach activities, and strengthened our engagement with our community.
During the third year of our 2022-2025 Strategic Plan, we engaged in thorough consultations and responded to the International Auditing and Assurance Standards Board (IAASB) across various projects, including Audit Evidence, Going Concern, and Sustainability. We have also begun outreach activities for Fraud (IAASB response deadline: June 5, 2024) and recently completed our outreach on our Proposed Deferral of the IAASB’s Public Interest Entity Narrow-Scope Amendments. Finally, we approved narrow-scope amendments to CAS 700, Forming an Opinion and Reporting on Financial Statements, and CAS 260, Communication with Those Charged with Governance, and published them in the CPA Canada Handbook – Assurance.
In the dynamic area of sustainability assurance standards, we partnered with the IAASB (with an International Organization of Securities Commissions representative in attendance) to co-host a roundtable discussion to gather feedback on the Exposure Draft, “Proposed International Standard on Sustainability Assurance (ISSA) 5000, General Requirements for Sustainability Assurance Engagements.” This in-person event gathered diverse perspectives to shape this significant groundbreaking assurance standard. The feedback received, along with responses to our Canadian Standard on Sustainability Assurance 5000 Exposure Draft, “General Requirements for Sustainability Assurance Engagements,” is shaping our next steps: ensuring that Canadian input is integrated into the IAASB’s development of the standard and considering possible revisions needed for Canada’s adoption. We deeply appreciate your invaluable feedback and insights, which we summarized here.
We are also on track to approve an exposure draft and begin consultations on our new Compilations of Future-oriented Financial Information (FOFI) and Pro Forma standard next year; thank you to our Task Force and Reference Group for the hard work and dedication.
Amidst the numerous projects and activities undertaken each year, a few principles remain constant: our commitment to transparency, the importance of communication, and your active engagement in our standard-setting process. We are dedicated to fostering an inclusive environment where all voices are heard and valued, and have continued to expand our outreach approach through various channels, including social media outlets, surveys, webinars, presentations, meetings, and roundtable discussions. In using these platforms, we have been able to facilitate meaningful dialogues and gather valuable insights from a diverse range of interested and affected parties. We worked closely with our Committees, including our advisory groups, reference groups, and task forces to obtain timely input to advance our technical standards projects. We have also undergone a review of our governance documents to ensure they remain fit for purpose in the current environment.
As we embark on the final year of our current strategic plan, I invite you to join us in shaping the path forward for our Strategic Plan 2026-2029. Your input and perspectives are important as we chart the course for the future of auditing and assurance standards in Canada.
In closing, I extend my sincere appreciation to the dedicated efforts of our AASB members, volunteers, and staff support team. It is through our collective commitment and collaboration that we have been able to achieve the milestones outlined in our annual plan.
Bob Bosshard, CPA, CA, ICD.D
Chair, AASB
Highlights of AASB Performance
Public Interest
Our standard-setting activities are predicated on serving the public interest. Our mission states that we serve the public interest by setting high-quality standards and guidance and supporting the effective application to address the evolving needs of Canadians.
We have built strong processes and procedures to assist in fulfilling our strategic goals and objectives. We carry out our activities through an independent and transparent due process that holds us accountable to the public.
We serve several interested and affected parties, including:
- members of the public;
- users of externally reported information;
- boards and audit committees;
- governments (federal, Indigenous, provincial, and municipal);
- regulators;
- preparers;
- assurance practitioners, including:
- professional accountants, both from larger firms and smaller firms, and
- other professionals performing assurance engagements; and
- other interested parties.
In performing its 2023-2024 standard-setting activities, we served the public interest by:
- following our due process in developing standards, including having key public interest discussions on all projects;
- performing outreach activities and obtaining input from others on a variety of topics and issues, including published documents for comment; and
- being transparent as projects progress and standards are finalized.
Strategic Goal #1 – Monitor and understand emerging issues in the changing environment to better anticipate standard-setting issues
We continued to execute our emerging issues monitoring process for identifying and assessing the impact of emerging issues on audit and assurance standards, which includes a separate framework for monitoring emerging technology and its impact on entities and practitioners.
To further support our work on the CSSA 5000 project, we upskilled ourselves on sustainability reporting and the assurance reports thereon, under current assurance and reporting standards landscape. Also, we collaborated with the Canadian Sustainability Standards Board to discuss matters of mutual interest.
Our activities in responding to other emerging areas included:
- prioritizing the impact and urgency of top emerging areas through our annual whiteboarding session to determine activities for our upcoming annual plan and direction for our next strategic plan;
- engaging with those responsible for inspecting the implementation of our standards to understand what challenges they see in practice and the related root causes; and
- monitoring the technology environment for emerging technology impacting entities and practitioners to determine whether our standards continue to be fit for purpose.
Strategic Goal #2 – Engage and collaborate with interested and affected parties to understand their needs and expectations
We engaged in outreach activities on standard-setting projects throughout the year, including all published documents for comment. This included activities such as hosting webinars, roundtables, targeted meetings, and gathering written responses from interested and affected parties.
We also co-hosted an in-person roundtable discussion in Toronto with the IAASB to gather feedback on the IAASB's Exposure Draft, “Proposed ISSA 5000, General Requirements for Sustainability Assurance Engagements.”
Input received through our outreach was used in developing our response letters to the IAASB for the following Exposure Drafts:
Other outreach activities currently in progress include Exposure Drafts for:
Throughout the year, AASB members also participated in various external events, including:
- presenting at CPA Canada’s ESG and ONE conferences;
- presenting at CPA Alberta’s Conference for Accounting Educators;
- attending the CPA Canada/ISSB’s Accountant Investor Dialogue;
- attending the Canadian Public Accountability Board (CPAB) Symposium: The evolving fraud landscape; and
- attending the jointly hosted Audit Quality Roundtable from the CPAB, Office of the Superintendent of Financial Institutions and Canadian Securities Administrators.
Strategic Goal #3 – Set high-quality standards and guidance that respond to the evolving needs and expectations of interested and affected parties
International Standard-setting
We support Canadian members on the IAASB by providing on-going input on its projects. This input includes:
- providing feedback on board meeting materials;
- performing outreach to inform information gathering activities; and
- consulting on Exposure Drafts and submitting response letters.
We provided input on the following projects:
Canadian Standards Projects
This year we continued to make progress on our Canadian project, Compilations of FOFI. Our work was supported by the significant effort of our Task Force and Reference Group as we approach the finalization of our exposure draft.
Strategic Goal #4 – Enhance our standard setting processes and capabilities to develop more timely solutions
We continued to implement relevant recommendations of the Independent Review Committee based on conclusions reached by the Auditing and Assurance Standards Oversight Council. This included:
- to consider the impact to AASB governance documents (Due Process Manual, Terms of Reference, and Statement of Operating Procedures) including amending governance documents to acknowledge the AASB’s role in setting sustainability assurance standards; and
- to pursue Indigenous representation and engagement in our work.
Additionally, we continued to assist the IAASB in drafting ISSA 5000 in a timely manner by providing a staff resource to its Sustainability Assurance Drafting Team.
Strategic Goal #5 – Support the effective implementation and application of standards and guidance to enhance consistency and quality in engagement performance
A key component of our activities is to support the effective implementation of newly developed and revised standards.
As each project reaches its finalization stage, we develop an implementation risk assessment. This year we completed an assessment for PIE Track 1 revisions.
We also supported the development of guidance by CPA Canada related to:
We also authored our own Audit & Assurance Alert, “Auditor Reporting and Communicating with Those Charged with Governance – Narrow-scope Amendments,” on the PIE Track 1 revisions.