Newswire December 2021

IAASB Non-authoritative support material: using automated tools and techniques on audit planning 

The IAASB has published non-authoritative support material on using automated tools and techniques in the planning stage of an audit. This highlights the impact of technology when applying certain aspects of the International Standards on Auditing (ISAs). It focuses on specific considerations for planning an audit in accordance with ISA 300, Planning an Audit of Financial Statements, that may be relevant when using automated tools and techniques. This publication is set out as a FAQ and looks to help the audit firm as technology evolves and new approaches to audit develop.  

Audit Enforcement Procedure feedback statement 

The FRC has published a revised Audit Enforcement Procedure (AEP) and feedback statement. This follows consideration of the responses received to the consultation launched in July this year regarding proposed amendments to the AEP. The AEP has been further amended to reflect stakeholders’ feedback and responses. The revised AEP will come into force on 5 January 2022. Current guidance will be amended to reflect the amendments to the AEP and will be made available on 5 January.   

Consultation on annual review of FRS 101 

The FRC has issued FRED 79 FRS 101 Reduced Disclosure Framework – 2021/22 cycle, which proposes no amendments to FRS 101 as a result of its latest annual review. The FRC are requesting comments on FRED 79 by 1 March 2022.

Areas of supervisory focus for 2022/23 

The FRC has confirmed its areas of supervisory focus for 2022/23, including priority sectors, for corporate reporting reviews and audit quality inspections.   The Supervision Audit Quality Review team will pay particular attention in its reviews to areas including climate-related risks, fraud risks, and cash and cash flow statements. In selecting corporate reports and audits for review, the priority sectors that are under particular pressure including Travel, Hospitality and Leisure and Retail. The Supervision Corporate Reporting Review team will supplement its routine reviews of corporate reporting with six thematic reviews. 

Proposed changes to IFRS  

Proposals have been published by International Accounting Standards Board designed to enhance the transparency of supplier finance arrangements and their effects on a company’s liabilities and cash flows. The proposals are open to comment until 28 March 2022.   

TAXATION

Work out Inheritance Tax due on gifts

HMRC have issued guidance on which gifts count towards the value of the estate, how to value them and work out how much Inheritance Tax may be due.

Clearance applications and exempt distribution when a company purchases its own shares

HMRC has issued guidance about clearance applications and how to apply to HMRC for advance confirmation of an exempt distribution when a company purchases its own shares.