The Auditing and Assurance Standards Board (AASB) proposes, subject to comments received following exposure, to amend International Standard on Auditing (ISA) 720 (Revised), The Auditor’s Responsibilities Relating to Other Information, before adopting it as Canadian Auditing Standard (CAS) 720.
Over recent years, there have been significant developments in corporate reporting, particularly in relation to the detail included in companies’ annual reports as well as the importance ascribed by users to the information in annual reports beyond the audited
financial statements and the auditor’s report thereon. The weight that users place on this other information, and the need for increased clarity in the auditor’s report regarding the auditor’s involvement with such other information, has notably increased since extant ISA 720, The Auditor’s Responsibilities Relating to Other Information in Documents Containing Audited Financial Statements, was issued. In light of these developments, the IAASB sought to revise ISA 720 to ensure that it is sufficient and fit for purpose in the context of today’s financial reporting environment.