The International Ethics Standards Board for
Accountants (IESBA) has issued proposals to amend the definition of
“those charged with governance” in its Code of Ethics for
Professional Accountants.
In its exposure draft, Proposed Change to
the Definition of “Those Charged with Governance”, the IESBA
has proposed that in each instance when the Code refers to
communication by “those charged with governance” the language
should be changed to “those charged with governance or a subgroup
thereof.”
IESBA wants to reconcile the definition with
the one used by the International Auditing and Assurance Standards
Board (IAASB) in the standard ISA 260 Communication with Those
Charged with Governance.
ISA 260 addresses matters to be communicated
by the auditor and provides guidance on who should receive the
communication.
The proposed change aims to clarify that the
communication may be with a subgroup of those charged with
governance, such as an audit committee, and may assist the
governing body in meeting its responsibilities.
In those cases, the auditor shall determine
with whom within the entity’s governance structure to communicate,
IESBA explained.
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By GlobalDataIESBA hopes the change will assist those who
are familiar with ISA 260 by clarifying that the definition in the
Code is intended to be the same as in ISA 260.
Deadline for comment is 31 October.
