Virtual feedback forum – audit practitioners – ISA (NZ) for LCE

The XRB is seeking feedback from stakeholders on whether to adopt the International Standard on Auditing (ISA) for Less Complex Entities (LCE) in New Zealand. 

We have heard concerns that the auditing standards are becoming increasingly complex and written in the context of highly regulated, large, listed entities. In New Zealand, the type of entities that are required to have an audit varies considerably. There are many LCEs that have audits, including charities, sports clubs, schools and early childhood centres. 

It is important that New Zealand auditors provide feedback to help us determine whether or not we adopt this standard in New Zealand.  

The ISA for LCE is a stand-alone auditing standard available for auditors to use when auditing less complex entities. The standard contains all requirements necessary to obtain reasonable assurance about whether the financial statements of a less complex entity, as a whole, are free from material misstatements, whether due to fraud or error.

The XRB is seeking feedback on: 

• whether auditors will use the International Standard on Auditing (ISA) for Less Complex Entities (LCE) in New Zealand.  
• the applicability of the proposed standard in New Zealand. 
• whether or not, and how to incorporate the audit of service performance information within the New Zealand Standard. 

At this event we will:

• provide a summary of the proposed standard. 
• explore the potential benefits and costs of adoption.
• delve into a proposed New Zealand-specific addition to enable the audit of service performance information.
• request your views on key aspects of our consultation via polls and written comments.