by John McCarthy Consulting Ltd. | Jun 3, 2025 | Blog, News
The UK Financial Reporting Council has recently published some really useful guidance, as part of a campaign to support SME Auditors which explains What is an Audit?
Auditors themselves will find the guide helpful in explaining to existing and prospective clients what an audit is and what it is not.
The guide explains:
- What is an audit?
- What do we mean by ‘materiality’?
- What is the purpose of an audit?
- What value does an audit bring to the audited entity?
- What are the principles common to all audits?
For example, the section on materiality explains that materiality is central to the audit. A material misstatement is one that could reasonably be expected to influence the economic decisions of the intended users of the financial statements.
The auditor is not, therefore, attempting to identify all misstatements of any size that may be present in the financial statements, only those that are material.
It draws attention to the fact that a misstatement can be material by nature as well as by value. For example, a fraudulent misstatement may be deemed material even if it is below quantitative materiality.
This guide is well worth reading and passing on to your clients to help better explain the valuable service that auditors provide. See What is an Audit? for more details.
For audit cold file reviews and tailored training sessions explaining more about various topics like AML, Audit, FRS 102, please send a mail to john@jmcc.ie.
For more on engagement and representation letter templates and a variety of CPD webinars on money laundering and other accounting/audit related topics, please go to our website for:
ISQM TOOLKIT, or if you prefer to chat through the different audit risks and potential appropriate responses presented by this new standard. We typically tailor ISQM training and brainstorming sessions to suit your firm’s unique requirements. Please contact John McCarthy FCA by email at john@jmcc.ie.
by John McCarthy Consulting Ltd. | May 30, 2025 | Blog, News
The UK Financial Reporting Council (which writes the audit standards for the UK and Ireland. These standards licenced by the IAASA for use in Ireland) is inviting stakeholders to join a webinar where the ‘International Standard on Auditing for Audits of Financial Statements of Less Complex Entities’ (ISA for LCE) will be discussed.
You had better get your skates on as the webinar is Wednesday 4 June 2025 from 1pm to 2pm Irish time. Registration is free of charge and is available here.
The International Auditing and Assurance Standards Board (IAASB) issued the International standard on auditing for audits of financial statements of less complex entities (‘ISA for LCE’) in December 2023. It becomes effective for jurisdictions that have adopted it for audits beginning on or after 15 December 2025.
Previously the FRC said that there is no intention by the UK to adopt ISA for LCE. Hopefully this is a sign that there is a change of heart, but the outcome will depend on the input from the ongoing consultations and research by the Financial Reporting Council SME Project Team.
Many practitioners and commentators that are of the opinion that the ISAs (Ireland) are disproportionate for SME clients in a number of areas and while they are supposed to be scalable for smaller entity audits, there is insufficient guidance on what this means.
There may never again be an opportunity like this so do play your part to help inform the outcome of this project.
For audit cold file reviews and tailored training sessions explaining more about various topics like AML, Audit, FRS 102, please send a mail to john@jmcc.ie.
For more on engagement and representation letter templates and a variety of CPD webinars on money laundering and other accounting/audit related topics, please go to our website for:
ISQM TOOLKIT, or if you prefer to chat through the different audit risks and potential appropriate responses presented by this new standard. We typically tailor ISQM training and brainstorming sessions to suit your firm’s unique requirements. Please contact John McCarthy FCA by email at john@jmcc.ie.
by John McCarthy Consulting Ltd. | May 18, 2025 | Blog, News
We saw last week that the proposed new AML Regulation AMLR places additional emphasis on AML training for employees and others.
This week we look at Article 13 of the EU AML Regulation AMLR which mandates regular assessments for individuals responsible for an obliged entity’s AML/CFT compliance.
Such personnel must be regularly evaluated on their:
- Skills
- Knowledge
- Expertise
- Integrity, and
- conduct
The assessments carried out must be performed on new personnel prior to taking up responsibility for AML compliance activities, including agents and third parties. The intensity of the subsequent assessments shall be risk based and determined on the basis of the tasks entrusted to the person and risks associated with the function they perform.
Conflicts of interest
Conflicts of interest must be avoided, and employees must disclose any close personal or professional relationships with the entity’s current/prospective clients to the compliance officer.
The firm must have procedures in place to prevent such staff from being involved in compliance tasks related to these clients.
For audit cold file reviews and tailored training sessions explaining more about various topics like AML, Audit, FRS 102, please send a mail to john@jmcc.ie.
For more on engagement and representation letter templates and a variety of CPD webinars on money laundering and other accounting/audit related topics, please go to our website for:
ISQM TOOLKIT, or if you prefer to chat through the different audit risks and potential appropriate responses presented by this new standard. We typically tailor ISQM training and brainstorming sessions to suit your firm’s unique requirements. Please contact John McCarthy FCA by email at john@jmcc.ie.
by John McCarthy Consulting Ltd. | May 18, 2025 | Blog, News
The proposed new EU Anti-Money Laundering Regulation (AMLR) is expected to be effective in Ireland in 2027. This week we look at one aspect of that Regulation relating to AML training.
Article 12 of the AMLR places greater emphasis on AML Training which is a more comprehensive requirement than in the 4th AML Directive. The 4th AML Directive only required AML training for the obliged entity’s employees who were involved in AML compliance.
Under the new proposed AMLR, accountancy firms must ensure that all individuals involved in implementing AML/CFT measures receive adequate training. The reach of the AML training requirement will be much wider than heretofore and accountancy firms will be held to account in a more comprehensive way for their AML training responsibilities.
Those that will need to have the AML training under the AMLR include:
- Employees;
- Agents; and
- Third party contractors.
The AML training should enable these personnel to recognise potential ML/TF activities and know what steps to take when they encounter them.
For audit cold file reviews and tailored training sessions explaining more about various topics like AML, Audit, FRS 102, please send a mail to john@jmcc.ie.
For more on engagement and representation letter templates and a variety of CPD webinars on money laundering and other accounting/audit related topics, please go to our website for:
ISQM TOOLKIT, or if you prefer to chat through the different audit risks and potential appropriate responses presented by this new standard. We typically tailor ISQM training and brainstorming sessions to suit your firm’s unique requirements. Please contact John McCarthy FCA by email at john@jmcc.ie.
by John McCarthy Consulting Ltd. | May 1, 2025 | Blog, News
The new AMLR will have an increased impact on AML governance and responsibilities within firms. It requires:
- a strong internal control framework, including policies, procedures, controls,
- a risk assessment, and
- an independent audit function.
The AMLR also clearly defines
- the compliance manager role and
- the officer role,
- with requirements for their
- appointment
- responsibilities, and
- protection from retaliation.
Strengthened Customer Due Diligence (CDD)
The AMLR largely builds on the existing CDD obligations set out in the 4th AML Directive. The existing transaction threshold that triggers CDD obligations for goods was already reduced from €15,000 to €10,000 since 2010.
Under the new rules, obliged entities carrying out occasional cash transactions that exceed €3,000 will also need to apply client/customer due diligence (CDD) measures.
Accountancy Europe has produced a factsheet that summarises the key provisions of the AMLR and highlights their implications for accountants, auditors, and tax advisors.
For audit cold file reviews and tailored training sessions explaining more about various topics like AML, Audit, FRS 102, please send a mail to john@jmcc.ie.
For more on engagement and representation letter templates and a variety of CPD webinars on money laundering and other accounting/audit related topics, please go to our website for:
ISQM TOOLKIT, or if you prefer to chat through the different audit risks and potential appropriate responses presented by this new standard. We typically tailor ISQM training and brainstorming sessions to suit your firm’s unique requirements. Please contact John McCarthy FCA by email at john@jmcc.ie.
