Consultation on the IAASB's Audit Evidence and Risk Response Exposure Drafts

Tuesday, August 18, 2026

The AUASB has released a Consultation Paper on the IAASB's Exposure Drafts of revised versions of ISA 330 The Auditor's Responses to Assessed Risks, ISA 500 Audit Evidence and ISA 520 Analytical Procedures.  Comments to the AUASB are sought by c.o.b. on 16 November 2026.

The IAASB’s proposed revised standards may affect how auditors respond to assessed risks and obtain and evaluate audit evidence. Key proposed changes include:

ISA 330 The Auditor's Responses to Assessed Risks

• A greater focus on professional scepticism in designing and performing audit procedures in response to assessed risks of material misstatement.
• A new stand-back provision requiring auditors to assess whether sufficient and appropriate audit evidence has been obtained in response to assessed risks.
• Allowing a ‘controls alone’ approach in certain circumstances, subject to guardrails.
• Removing the requirement to perform substantive procedures for every material class of transactions, account balance and disclosure irrespective of the assessed risk.

ISA 500 Audit Evidence

• Requiring auditors to evaluate the relevance and reliability of information used as audit evidence, with new application material on attributes that may be considered in evaluating the reliability of information (accuracy, completeness, authenticity, absence of bias and credibility).

ISA 520 Analytical Procedures

• Clearly distinguishing between substantive analytical procedures used as audit evidence, and non-substantive analytical procedures used in risk assessment and concluding procedures.
• Requiring auditors to develop sufficiently precise expectations in applying substantive analytical procedures, to establish appropriate thresholds for acceptable differences.

Technology

• While the standards remain principles-based to cater for future technological developments, a new appendix to ISA 500 would provide guidance on considerations when using technological tools in obtaining audit evidence. ISQM 1 would also include new application material on technological resources, including the approval of technological tools.

Please refer to the AUASB Consultation Paper for further information on proposed revisions.

Submissions should be sent to [email protected] or ‘Auditing and Assurance Standards Board, PO Box 204, Collins Street West, Melbourne, Vic 8007’. You can answer all questions in the Consultation Paper or selected questions.  If you provide comments directly to the IAASB, please also provide a copy to us.

Roundtables

The AUASB will hold the following roundtables in October 2026 to provide stakeholders with an opportunity to discuss the proposals and provide feedback.  Feedback will be used to inform the AUASB's submission to the IAASB on the Exposure Drafts and inform the AUASB in its deliberations on adoption of the final IAASB standards in Australia.

Places are limited, so early registration is encouraged.

Prior to attending, the AUASB requests attendees to:

• Review the Consultation Paper including the IAASB Exposure Drafts and Explanatory Memoranda; and
• Review the questions for respondents in Attachment 1 of the Consultation Paper.

Any questions on the Consultation Paper and the roundtables should be directed to [email protected].