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The Canadian CA profession’s Public Trust Committee formed an Independence Task Force (ITF) to review the independence provisions included in the Rules of Professional Conduct and determine whether or not any changes are needed. The ITF has determined that changes should be considered in two phases.
Exposure Draft
The first phase is the subject of an exposure draft. The exposure draft proposes that the current Canadian requirements related to rotation of the engagement partner and the engagement quality control reviewer change from rotation after five years followed by a five year “time-out” period to seven and two years respectively. The exposure draft proposes that this change be effective as soon as possible.
Consultation Paper
The second phase is the subject of a consultation paper. The ITF is of the view that in a world of increasingly integrated capital markets, it is in the best interest of investors, issuers and auditors that independence standards converge to the extent possible. The ITF has considered a detailed comparison of the independence provisions in the revised Code and those contained in the current Rules of Professional Conduct. It is of the view that it is appropriate to adopt the Code into the Rules, amended only as appropriate for Canadian specific circumstances. This approach reflects the CA profession’s obligation as a member of IFAC and also reflects the approach taken with the adoption of international accounting and auditing standards in Canada.
Comments on both documents should be received by June 15, 2010. Comments will be posted on the CICA web site within 10 days of the comment deadline.
For further information and access to the documents please visit Independence documents - English or Independence Documents - French.
April 16 , 2010
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