Developing a new ISA

The process of developing an ISA is as follows:

 A subject is selected for detailed study, with a view to eventually issuing an ISA
 After a period of study and research, if there is agreement to proceed, an exposure draft is produced. The
exposure draft is approved by the IAASB and then distributed widely amongst the profession and others for
comment
 Comments and proposed amendments are considered by the IAASB. The draft standard is then modified and
approved by the IAASB
 The new ISA is then published

INTERNATIONAL STANDARDS ON AUDITING (ISA)

ISAs are written in the context of an audit of FS by an independent auditor. They are to be adapted as necessayry
when applied to audits of other historical FS

Each ISA contains:

 An introduction
 Objectives
 Definitions (if necessary)
 Requirements which are shown by the word “shall” and are to be applied as relevant to the audit
 Application and other material which is for guidance only

33 standards

Conduct of an Audit in Accordance with

ISAs (ISA 200)

Complying with ISAs Relevant to the Audit

 The auditor shall comply with all

ISAs relevant to the audit. An ISA
is relevant to the audit when the
ISA is in effect and the
circumstances addressed by the
ISA exist
 The auditor shall have an
understanding of the entire text
 of an ISA, including its application and other explanatory material, to understand its objectives and to apply
its requirements properly
 The auditor shall not represent compliance with ISAs in the auditor’s report UNLESS the auditor has
complied with the requirements of this ISA and all other ISAs relevant to the audit