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ISCA has provided comments on IAASB’s Exposure Draft on Proposed ISA 500 (Revised) Audit Evidence and Proposed Conforming and Consequential Amendments to Other ISAs.
To be adaptable to evolving business and audit environments, ISCA is supportive of the enhancements to modernise the standard to accommodate the use of technology by entities and auditors. We proposed further elaboration on the use of data analytics to support and facilitate its adoption. We highlighted practical implementation challenges that auditors contend with when applying data analytics, which include extent of testing of the underlying data used, assessment of audit evidence obtained and dealing with exceptions. Addressing these practical issues in the standard may provide the impetus to drive the adoption of data analytics, especially among smaller audit firms.
ISCA also welcomes the enhancements to drive the application of professional skepticism when evaluating audit evidence. We shared areas where further clarifications over the requirements over the demonstration of professional skepticism and documentation expectations would be helpful to guide consistency in the application by the profession.
Click here to read our detailed comments.
Click here for the IAASB’s Exposure Draft.