SOCPA Decides Against Adopting the International Standard on Auditing for Audits of Less Complex Ent

OCPA's Audit Standards Board has completed its review of a new international auditing standard designed for less complex entities. The standard, known as ISA for LCE, was released by the International Auditing and Assurance Standards Board (IAASB) in December 2023 as an optional standalone standard that local authorities could choose to adopt. After conducting a detailed study, the Board identified several potential risks associated with adopting the standard in Saudi Arabia. These concerns include creating confusion about audit service quality expectations, uncertainty about required work effort levels, questions about assurance levels, and possible limitations on auditors when they need to work with the complete version of auditing standards. The Board concluded that these potential risks outweigh any expected benefits from adopting the standard.
The Board shared these findings with the public and specifically sought input from certified public accountants, providing them with a translated version of the standard. No feedback was received challenging the Board's assessment about the standard being unsuitable for adoption.
Based on this comprehensive review, SOCPA's Audit Standards Board has decided not to adopt the ISA for LCE in Saudi Arabia. The standard would have taken effect globally for audits starting on or after December 15, 2025.