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Unformatted text preview: These interpretations are in respect of the application of the IFAC Code of Ethics for
Professional Accountants to the topics of the specific queries received. They are
reproduced herein for ease of reference.
Application of Section 290 to assurance engagements that are not financial statement
This interpretation provides guidance on the application of the independence
requirements contained in Section 290 to assurance engagements that are not financial
statement audit engagements.
This interpretation focuses on the application issues that are particular to assurance
engagements that are not financial statement audit engagements. There are other
matters noted in Section 290 that are relevant in the consideration of independence
requirements for all assurance engagements. For example, paragraph 290.15 states that
consideration should be given to any threats the firm has reason to believe may be
created by network firms interests and relationships. Similarly, paragraph 290.21 states
that for assurance clients, that are other than listed entity financial statement audit
clients, when the assurance team has reason to believe that a related entity of such an
assurance client is relevant to the evaluation of the firm’s independence of the client, the
assurance team should consider that related entity when evaluating independence and
applying appropriate safeguards. These matters are not specifically addressed in this
As explained in The International Framework for Assurance Engagements issued by the
International Auditing and Assurance Standards Board, in an assurance engagement, the
professional accountant in public practice expresses a conclusion designed to enhance
the degree of confidence of the intended users other than the responsible party about the
outcome of the evaluation or measurement of a subject matter against criteria.
Assertion-based Assurance Engagements
In an assertion-based assurance engagement, the evaluation or measurement of the
subject matter is performed by the responsible party, and the subject matter information 145 By-Laws (On Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants
[Issued January 2007] APPENDICES
is in the form of an assertion by the responsible party that is made available to the
In an assertion-based assurance engagement independence is required from the
responsible party, which is responsible for the subject matter information and may be
responsible for the subject matter.
In those assertion-based assurance engagements where the responsible party is
responsible for the subject matter information but not the subject matter, independence
is required from the responsible party. In addition, consideration should be given to any
threats the firm has reason to believe may be created by interests and relationships
between a member of the assurance team, the firm, a network firm and the party
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- Fall '13