Changes to auditor independence standards could have far-reaching effects for auditors and accounting firms, the Institute warned this week. 
 
Under proposals from the International Ethics Standards Board for Accountants (IESBA), audit partner rotation would be required for all 'significant public interest entities'.  
 
As members of the International Federation of Accountants (IFAC), the accounting bodies in Australia rely on the Accounting Professional and Ethical Standards Board (APESB) to adopt IESBA standards, where possible.  
 
When this auditor rotation standard is formally considered by the APESB, the Institute will seek to ensure that it is not extended to inappropriate entities (for example, the standard may be unnecessary for certain small non-listed companies and not-for-profit entities). 
 
Background 
An exposure draft is expected in early 2008 and the Institute will be closely monitoring developments. Any changes will not come into effect until late-2009.  
 
To effect this change, the IESBA hope to split independence standards in two (with a revised Section 290 addressing independence requirements for audits and review engagements and a new Section 291 dealing with independence requirements for all other assurance engagements). 
 
The IESBA is an independent ethics standard-setting board that sits within the International Federation of Accountants (IFAC). 
 
For more information:

• The Institute: media release
• IFAC: about the IESBA