Auditing Profession Act, 2005 (Act No. 26 of 2005)Board NoticesIndependent Regulatory Board for AuditorsNew Rules Regarding Improper Conduct and Code of Professional Conduct for Registered AuditorsCode of Professional Conduct for Registered AuditorsPart B : Registered Auditors in Public PracticeSection 291 : Independence - Other Assurance EngagementsAssertion-Based Assurance Engagements |
| 291.17 | In an assertion-based assurance engagement, the members of the assurance team and the firm shall be independent of the assurance client (the party responsible for the subject matter information, and which may be responsible for the subject matter). Such independence requirements prohibit certain relationships between members of the assurance team and |
| (a) | directors or officers; and |
| (b) | individuals at the client in a position to exert significant influence over the subject matter information. |
Also, a determination shall be made as to whether threats to independence are created by relationships with individuals at the client in a position to exert significant influence over the subject matter of the engagement. An evaluation shall be made of the significance of any threats that the firm has reason to believe are created by network firm14 interests and relationships.
| 291.18 | In the majority of assertion-based assurance engagements, the responsible party is responsible for both the subject matter information and the subject matter. However, in some engagements, the responsible party may not be responsible for the subject matter. For example, when a registered auditor is engaged to perform an assurance engagement regarding a report that an environmental consultant has prepared about a company's sustainability practices for distribution to intended users, the environmental consultant is the responsible party for the subject matter information but the company is responsible for the subject matter (the sustainability practices). |
| 291.19 | In assertion-based assurance engagements where the responsible party is responsible for the subject matter information but not the subject matter, the members of the assurance team and the firm shall be independent of the party responsible for the subject matter information (the assurance client). In addition, an evaluation shall be made of any threats the firm has reason to believe are created by interests and relationships between a member of the assurance team, the firm, a network firm and the party responsible for the subject matter. |