ISA for LCE: A Better Fit for Audits of Less Complex Entities
One international standard, adopted jurisdiction by jurisdiction. Pick a market to see who sets the standard there and where it stands today.
New Zealand
Standard-setter · External Reporting Board (XRB)
New Zealand was one of the first movers. The External Reporting Board (XRB) has issued the ISA (NZ) for LCE, so firms here can audit eligible less complex entities under the standard today. As a New Zealand company, we follow the ISA (NZ) for LCE closely.
- Issued as the ISA (NZ) for LCE by the XRB
- Available for eligible NZ engagements today
- Localised to New Zealand requirements
Adoption and timing are decided by each jurisdiction’s standard-setter, and this list keeps moving. Talk to us about your requirements.
What you need to know about the LCE standard
The biggest change to auditing in over a decade, in plain terms. Scroll through each one, or jump straight to a topic.
A standard of its own
The ISA for LCE is a complete, standalone auditing standard. The IAASB issued it in December 2023 after years of consultation. Rather than working across the full suite of International Standards on Auditing, the auditor has every requirement for a less complex engagement in one place, tailored for the complexity of the job.
For an auditor that means far less to wade through. The requirements, the application material and the auditor's report are all set out for a less complex engagement, so your team is not searching the full ISAs and hoping nothing was missed. It is the same destination, reached by a shorter and clearer road.
- Issued by the IAASB, December 2023
- Self-contained — no cross-referencing the full ISAs
- Tailored for less complex entities
We build audit software. A purpose-built LCE solution
- LCE templates and checklists map to the standard
- Have confidence knowing you meet the requirements of the standard
- Unlock efficiencies the standard was designed to deliver
- Trusted with auditors' files since 2009 — secure and supported
LCE audit questions, answered
An LCE audit is an audit done under the ISA for LCE, the International Standard on Auditing for Audits of Financial Statements of Less Complex Entities. It’s a standalone global standard, and it gives the same reasonable assurance as a full-ISA audit using requirements scaled to the size and simplicity of the entity.
The IAASB issued the ISA for LCE in December 2023. It’s a self-contained auditing standard for smaller, less complex businesses, with every requirement for the engagement in one place instead of spread across the full suite of International Standards on Auditing.
The ISA (NZ) for LCE is New Zealand’s version of the standard, issued by the External Reporting Board (XRB). Auditors can use it once they’ve determined the entity (or group) is a less complex entity under Part A.
It comes down to the qualitative characteristics in Part A, plus any quantitative thresholds or prohibitions your jurisdiction sets. Listed entities and certain higher-risk entities are out of scope, and the judgement, with its supporting evidence, belongs in the audit file.
Yes. The templates, checklists and workflow are built and ready, so firms picking up the standard can start a compliant engagement right away instead of building a methodology from scratch.
Yes. It’s a single global standard from the IAASB, meant to be used anywhere. Each jurisdiction adopts, permits or adapts it through its own standard-setter, which gives firms working across borders a common base to build on.
Information about the adoption status of International Standards on Auditing (ISAs), including the ISA for LCE, is available on IFAC’s Adoption Status page: ifac.org/what-we-do/global-impact-map/adoption-status.
