Revised ISA 315 to strengthen audit of material misstatement
Released 19 December 2019
The International Auditing and Assurance Standards Board (IAASB) has released the revised ISA 315 to tighten up the audit requirements for material misstatements in the event or fraud or error.
ISA 315 (Revised 2019) becomes effective for financial statement audits for periods beginning on or after December 15, 2021.
One of the key changes has been to tighten up the audit requirements to clarify the methodology for identifying and assessing risk to improve audit quality.
The revision also emphasises the importance of identifying potential fraud, for example if companies try to distort the figures to improve business performance or intentionally misstate the financial statements. This requires that strict controls are put in place, for example to ‘identify fraud of any magnitude that involves senior management’.
View ISA 315 (Revised 2019).