IAASB issues new guidance on auditing less complex entities

The International Auditing and Assurance Standards Board has issued new guidance on the application of the International Standard on Auditing for Audits of Financial Statements of Less Complex Entities.

The standard, or ISA for LCE, is built on the foundation of the International Standards on Auditing and addresses the specific needs of audits of smaller and less complex businesses.

The Authority Supplemental Guidance will help in determining the appropriate situations to use the standard, which will be particularly beneficial for legislative and regulatory authorities implementing the standard, firms developing related policies or procedures, and auditors.

The guidance is available on the IAASB website and joins previous resources including videos, webinars and the Auditor Reporting Supplemental Guidance. The IAASB is also planning to issue an adoption guide and a first-time implementation guide later this year, which the board intends to round out a comprehensive toolkit for navigating adoption and implementation of the ISA for LCE.

The new guidance is neither an amendment or override of the ISA and LCE and is also not a substitute for reading the original standard, according to the IAASB.