Exposure Draft of Thai Standards on Auditing 540

On 24 January 2020, The Federation of Accounting Professions (“TFAC”) released the exposure draft (“ED”) of Thai Standard on Auditing (“TSA”) 540 (revised) for public hearing and comments.

Keywords: Mazars, Thailand, Accounting, TFAC, ED, TSA, IAASB,TFRS

19 March 2020

This standard requires the auditor to evaluate, based on the audit procedures performed and the audit evidence obtained, whether the accounting estimates and related disclosures are reasonable in the context of the applicable financial reporting framework, or are misstated.

The purpose of issuing the ED of TSA 540 is to develop this standard to comply with the ED of International Standard of Auditing 540 that was launched by the International Auditing and Assurance Standards Board (IAASB). The IAASB and TFAC have sought to make the ED of ISA 540/TSA 540 (revised) scalable, and the revised standard will be used for all accounting estimates in the context of the reporting framework for publicly accountable entities, including the following standards:

Related Thai Financial Reporting Standards (“TFRS”)

Accounting Estimates

TFRIC 12 – Service Concession Arrangements

Measurement and valuation of infrastructure assets

TFRS 9 – Financial Instruments

Allowances for expected credit losses

TFRS 4 – Insurance Contracts

Valuation of insurance liabilities

TFRS 15 – Revenue from Contracts with Customers

Revenue recognition for long-term contracts

In addition, the name of this standard has been changed from ‘Auditing Accounting Estimates, including Fair Value Accounting Estimates, and Related Disclosures’ to ‘Auditing Accounting Estimates and Related Disclosures’.

This standard will become effective in Thailand for auditing the financial statements of publicly accountable entities for periods beginning on or after 15 December 2020.

For more information about the ED of TSA 540 (revised), please visit FAP's websitethe FAP's newsletter, and the IAAB's newsletter