Methodology Update—Fall 2023 Accounting and Assurance Update
Oct-2023

Target audience: All Attest Auditors

Effective date: The revised methodology is effective upon release.

Standards: This update reflects changes in standards effective for fiscal years beginning on or after 1 January 2023 (IFRS) and 1 April 2023 (PSAS).

Copyright: CPA Canada Handbook sections and excerpts are reproduced herein for your non‑commercial use with the permission of The Chartered Professional Accountants of Canada (“CPA Canada”). These may not be modified, copied or distributed in any form as this would infringe CPA Canada’s copyright.

Description of subject: The update includes changes to TeamMate procedures, templates and checklists. Significant changes to the methodology are summarized below.

Key changes are:

IFRS

  • New IFRS 17—Insurance contracts procedures

    • New IFRS 17 procedures can be found in four new TeamMate programs: Insurance contract assets, Reinsurance contract assets, Insurance contract liabilities and Reinsurance contract liabilities for audit entities adopting IFRS 17.

    • The complete list of impacted procedures and FSLIs related to this methodology update can be found in the IFRS Inventory of Procedures report.

PSAS

  • New PS 3400—Revenue and PS 4200 - Financial statement presentation by not‑for‑profit organizations procedures

Note: The procedures in the IFRS and PSAS TeamMate cabinets were updated on your C Drive. Audit teams can obtain these procedures directly from the TeamMate libraries.

IMPORTANT—Remember to update the Substantive Procedure Library in the Audit Planning Template in order to ensure you are using the most up to date IFRS and PSAS substantive procedure libraries.

Annual Audit Procedures Cabinet

  • The procedure “Determine scoping and perform inherent risk assessment—TeamMate” was updated to reflect changes to the new Audit Planning Template;

  • The procedure “Understand accounting estimates” was updated to reflect the adoption of IFRS 17— Insurance contracts;

  • The procedure “Determine audit strategy and plan” was updated to include an additional step for audit teams with entities adopting IFRS 17—Insurance contracts.

Annual Audit Procedures—Supplement Cabinet

  • The procedure “Obtain an understanding of management’s implementation plan for IFRS 17” was added for audit teams with entities adopting IFRS 17—Insurance contracts.

Note: The four new and updated procedures in the Annual Audit and Supplement TeamMate Cabinets were not updated on your C Drive. These assurance procedures can be found in PROxI folder 2332306. It is important that teams update their file with the procedures found in the PROxI folder as applicable.

Updates to Templates and Checklists

The following “Templates and Checklists” have been updated. They can also be obtained on the Templates and Checklists page on the INTRAnet.

FSLI Risk Matrices

The PSAS and IFRS FSLI risk matrices were updated to reflect the new and revised procedures in the PSAS and IFRS TeamMate cabinets and new and revised risks relative to each FSLI. The risk matrix is intended to be a quick reference tool which lists the procedures available in the TeamStore cabinet and aligns them to the typical risks for each FSLI by assertion.

Audit Planning Template (APT)

The Audit Planning Template was updated to:

  • Adopt missing updates contained in the document “Audit Planning Template—Instructions—CAS 315”
  • Improve the scoping and inherent risk assessment process by documenting the scoping and the inherent risk assessment directly within the APT.

Audit Planning Template—Instructions—CAS 315 

This template was removed as the significant items were implemented in the new version of the Audit Planning Template.

Letters for Solicitor/Client Privilege

The letters for Solicitor/Client Privilege have been updated to:

  • Clarify the intent when requesting documents that may be subject to solicitor‑client and other privileges;
  • Align the wording between the letters used for Annual Audits, Special Examinations and Performance Audits.

Management Representation Letters

The Management Representation Letter—IFRS was updated for the adoption of IFRS 17—Insurance contracts, to remove sections related to accounting standards that are no longer applicable, and to adopt other editorial changes.

The Management Representation letter—PSAS was updated for editorial changes only. Please note that changes related to the adoption of PS 3400 were reflected in the previous version of the template.