Your fortnightly technical updates newsletter (6 January 2021)

Members' Handbook

Update No. 253 relates to:

Amendments to the Code of Ethics for Professional Accountants as a results of the International Ethics Standards Board for Accountants’ (IESBA) Revisions to the Code to Promote the Role and Mindset Expected of Professional Accountants to better promote the role and mindset expected of all professional accountants; and
PN 730 (Revised) Guidance for Auditors Regarding Preliminary Announcements of Results to align with the latest regulatory requirements and provide additional guidance in various practical scenarios.

Update No. 254 relates to:

Editorial corrections to HKAS 39 Financial Instruments: Recognition and Measurement and HKFRS 9 Financial Instruments and an update of the glossary.

Standard setting

IASB December 2020 IFRS for SMEs

The December 2020 IFRS for SMEs Update newsletter, providing a summary of news, events, and other information about the IFRS for SMEs standard and related SME activities, is now available.

Institute submission

The Institute has submitted its comment letter on the IFRS Foundation's Consultation Paper on Sustainability Reporting

Guidance and webinar on ESG Assurance Reporting

The Institute has published Auditing and Assurance Technical Bulletin (AATB) 5 Environmental, Social and Governance (ESG) Assurance Reporting to provide practical non-authoritative support material intended to assist practitioners in performing ESG assurance engagements in accordance with Hong Kong Standard on Assurance Engagements (HKSAE) 3000 (Revised) Assurance Engagements Other than Audits or Reviews of Historical Financial Information. A lunch webinar will be held on 13 January to help practitioners better understand the contents of AATB 5, and assuring ESG reports.

Financial fraud risks to watch for amid the pandemic

An article in the Journal of Accountancy discusses financial fraud risks that professional accountants including auditors need to be especially watchful for fraud amid severe financial pressure associated with the coronavirus pandemic.

Report on the IESBA accomplishments

The IESBA report includes an update on the Board’s current projects and initiatives and highlights its efforts in promoting awareness, adoption, and implementation of the International Code of Ethics for Professional Accountants (including International Independence Standards). It also summarizes the Board’s accomplishments between 2016 and 2020.

Advocacy and practice development

SFC’s consultation conclusions on proposed customer due diligence requirements for open-ended fund companies

On 23 December, the Securities and Futures Commission (SFC) released consultation conclusions on proposed customer due diligence requirements for open-ended fund companies (OFCs). In the consultation, the SFC had proposed that OFCs should be required to appoint a responsible person to carry out anti-money laundering/counter-terrorist financing functions as stipulated under Schedule 2 to the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Cap. 615), similar to the requirements imposed on limited partnership funds under the Limited Partnership Fund Ordinance (Cap. 637) (LPFO). Under the LPFO, the responsible person must be an authorized institution, a licensed corporation, an accounting professional or a legal professional. Following the consultation, the SFC will proceed with legislation to implement the proposal.

Please refer to the press release for details.

Announcements by the Inland Revenue Department

Members may wish to be aware of the following matters:

Announcements by the government

Members may wish to be aware of the following matter:

Government extends social distancing measures under Prevention and Control of Disease Ordinance

AML notices

For the current lists of terrorists, terrorist associates and relevant persons/ entities under United Nations sanctions, members should refer regularly to the Institute's AML webpage. Other useful documents and guidance can also be found on the same page.

Useful resources

Publications from other organizations:

A year of evolution: CFOs on 2021 from Financial Management
2020’s best advice for CFOs from CFO.com
Tech trends 2021 by Deloitte
Four steps to get started with data analytics by AICPA
5 skills you need to succeed in a digital economy by CIMA

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Disclaimer: Some sections contain information from outside sources. We endeavour to link to reputable sources but the Institute is not responsible for the accuracy of the content and the content does not necessarily represent the views of the Institute.

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