The International Auditing and Assurance Standards Board (IAASB) has issued the exposure draft ‘Reporting on Audited Financial Statements: Proposed New and Revised International Standards on Auditing’.

IAASB’s exposure responds to calls from stakeholders and users of audited financial statements for more informative auditor’s reports in the wake of the global financial crisis

"We expect the proposed new and revised standards will result in substantive changes to how auditors contemplate and approach communication to users of their reports," IAASB chairman Arnold Schilder said.

Schilder said the proposed changes are "critical to the perceived value of the financial statement audit" and to underline the "relevance of the auditing profession."

Among the proposal, IAASB has introduced the standard ‘Communicating Key Audit Matters in the Independent Auditor’s Report’

"The intended outcome of this proposal is more informative audit reports, with information about the audit of the financial statements that is unique and more specific to the entity that has been audited," James Gunn IAASB technical director said.

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Following the IAASB’s exposure draft, the UK Financial Reporting Council (FRC) welcomed the proposed changes and launched a consultation which ends on 1 November.

"We believe they are, in principle, consistent with the governance-led changes made by the FRC over the last year to audit committee and auditor reporting in the UK and Ireland, FRC Audit and Assurance Council chairman Nick Land said.

The deadline to comment on IAASB’s exposure draft is 22 November.

UK Financial Reporting Council