March 2025
Greetings,
Another busy month has passed us by and always there has been a lot going on. From a technical perspective, this month’s newsletter includes an update on the newly approved Fraud standard, guidance on preparing reports and accounting for cash surrender value on life insurance contracts. From a practice management perspective, I share an entertaining article about career lessons learned from the movie “Wicked”, one of my all-time favorites. Read on…
Hot Off the Press
Revised Fraud ISA 240 Standard Approved!!!!
Another revised standard has been approved (remember, that Going Concern ISA 570 (Revised) was approved in December 2024). In their meeting this month, the IAASB approved the Exposure Draft of International Standard on Auditing (ISA) 240 (Revised), The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements. The effective date of this standard is for periods beginning on or after December 15, 2026. There were many consequential and conforming amendments to many other ISAs as a result of this revised standard.
What this means in Canada is that the AASB is now expected to approve Revised CAS 240 in their June meeting. And, as the AASB has provided their comments to the IAASB and followed this project closely, no Canadian amendments to the standard are expected. The effective date will most likely be the same as at the International level.
One of the most significant changes that has occurred is the redefinition of professional skepticism. The phrase “not withstanding the auditor’s pas experience of the honesty and integrity of management and those charged with governance” has been removed. Now the requirement is simply to maintain an attitude of professional skepticism throughout the audit.
For those of you who can’t wait to read the new standard, you can read the newly approved ISA 240 (Revised) here… Agenda Item 2, IAASB March 18-21,2025 IAASB Quarterly Board Meeting
Once the standard has been approved in Canada, I will provide a detailed update on all the changes and an overview of what to expect for both CAS 240 and CAS 570.
Revised Audit and Review Reporting Guides
This is a repeat of last month’s topic, but as I am still receiving questions about this resource, I thought it useful to include it again. Download the Guides now so you have them handy over the next few months.
Do you ever sometimes wonder about what to include in your report when you have a qualification of emphasis of matter paragraph? I get many questions from practitioners about “what to say” in a report. The main source of my response is two amazing publications from CPA Canada… The Reporting Implications of Canadian Auditing Standards and Reporting Implication of CSRE 2400.
The most recent editions of these Guides have just been released. These publications are so helpful in providing guidance with respect to commonly occurring circumstances. Presenting a series of problems in a Q&A format and as illustrative reports, the guides are designed to help you understand and apply requirements and supporting guidance issued by the AASB relating to reporting.
You won’t read the guides cover to cover (+500 pages) but you will want to have them handy for those unusual circumstances you are sure to encounter over the upcoming months as you perform audit and review engagements. Check them out here…
CPA Canada Reporting Implications of Canadian Auditing Standards
CPA Canada Reporting Implications of CSRE 2400
Accounting for Life Insurance Contracts with CSV (AcG-21)
This is not a new topic; however, I have been receiving numerous questions about accounting for insurance policies with CSV, and I wanted to provide guidance on this matter this month. Cash surrender value (CSV) is the amount that would be realized by the owner of a life insurance policy upon termination of the policy prior to death of the insured. In 2024, the AcSB issued AcG-21, which provided guidance on accounting for these contracts. Quite simply, the guidance states an entity measures the CSV at the amount that would be immediately realized up to termination of the policy prior to death. Many organizations were accounting for life insurance contracts this way already but this formalizes measurement, and presentation and disclosure.
Access AcG-21 (under Part II Accounting Guidelines) via Knotia here
5 Lessons You Can Learn from “Wicked”
I love the movie Wicked and have seen it three times now, and I would see it a fourth, and maybe even a fifth time. I love the story, the singing and the messaging. I guess highlights have been showing up in my algorithms since I have been reading every article and background story of this amazing movie.
I come across this article about how beyond telling you the story of the Wicked Witch of the West, Wicked teaches you valuable lessons that can inspire and elevate your career. I enjoyed the lessons in this wonderful article, and I think you might too.
4 Expert Tips to Combat Complaining at Work
Busy season can always be a challenge and sometimes we just have to “let it out”. Venting with colleagues may feel good in the moment, but it can also have a negative effect on workplace culture. Two experts offer constructive alternatives to complaining in the workplace. I like the author’s idea about questioning yourself about why it matters. That is a question I ask myself a lot before I open my mouth. Sometimes, it does matter, but other times, it does not, and therefore, it is better to not say anything at all. The moment will pass.
2024 Declarations Past Due
Deadlines for reporting your CPD hours have passed, so hopefully, you have all your hours in. And, it is also the time for paying your dues so make sure you have paid attention to those emails too so you don’t get caught having to pay late fees.
Pro tip… make sure you input your hours throughout the year rather than waiting until just before the deadline. It will save you time.
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This is the time when most practitioners have their heads down and their pens (well, computers) up. I will continue to keep you abreast of what you need to know right now. In the meantime, if you have any questions, reach out any time. I am here to help you save time and achieve peace of mind.
Best regards,
Kirsten S. Albo, FCPA, FCA
President