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July 14, 2008

Next IAASB leader to focus on worldwide ISA implementation

Arnold Schilder will take the helm of the International Auditing and Assurance Standards Board (IAASB) on 1 January 2009 – a time when the board will begin a hiatus on updating and issuing standards and focus on international implementation.
 
Arnold Schilder, International Auditing and Assurance Standards BoardThe next IAASB chair has almost 40 years of experience in the professional and financial services industries. He recently celebrated his ten-year anniversary at De Nederlandsche Bank, the Dutch central bank, and prior to that was a senior international audit partner at the Dutch member firm of Coopers & Lybrand – leaving the day the international network merged with Price Waterhouse.

Other roles featured on Schilder’s curriculum vitae include past-president of Dutch institute Koninklijk Nederlands Instituut van Register Accountants (Royal NIVRA) and member of the Public Interest Oversight Board (PIOB), which oversees the IAASB.

The IAASB is due to complete a five-year project on improving the clarity of ISA in September and Schilder said following the completion of the project, the board intends to release no new standards for two years to give the profession time to adapt to recent changes.

Going global

The board’s next priority will be to investigate ways to stimulate the global implementation of the auditing standards. “Also further political endorsement, for example the European Union, and we need to liaise with the [US Public Company Accounting Oversight Board – PCAOB] on how we can see further convergence between US GAAS and these international standards,” Schilder added.

Last December, Europe’s internal market commissioner Charlie McCreevy announced it was too early to decide whether ISA should be applied in the EU.

While the decision was not well received by firms who spoke to The Accountant at the time, Schilder said he was not disappointed by the cool reception because he understood how the processes work.

“I know there is a positive attitude towards this work, which has been evidenced by the fact that the European Commission now has two members on the Public Interest Oversight Board… that is a clear example of the positive interest of the commission,” Schilder explained.

The EU moved quickly to adopt IFRS and Schilder conceded that subsequent challenges, such as the carve out in IAS 39, alerted the commission to the importance of due processes and ensuring all stakeholders’ comments are taken into account.

“I certainly see that reflected in how [the EC is looking at] the due process surrounding the auditing standards, which is fair and completely understandable,” he said.

While focusing on the global spread of the standards, Schilder said there may also be several new projects on the cards.

“There might be further study on the quality of the auditor’s report, whether that still fits the purpose these days,” he said. “Sustainability reporting is another topic that is quite interesting, as is the needs of SMEs and how they can best be serviced.

“So there are several very interesting topics that will appear on our future agenda.”

Schilder said he also foresees further positive moves towards the convergence of ISA and US GAAS.

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