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Key initiatives undertaken by the CA Sri Lanka Auditing Standards Committee in 2022 with regard to revision of Auditing
Standards
y Promoting the adoption of the New and Revised Quality Management Standards (ISQM 1, ISQM 2 and ISA 220 (Revised) in Sri
Lanka in line with the following effective dates;
y SLSQM 1: System of quality management is required to be designed and implemented by December 15, 2023, while the
evaluation of the system of quality management required by paragraphs 53–54 of this SLSQM should be performed within one
year following December 15, 2023.
y SLSQM 2: Audits and reviews of financial statements for periods beginning on or after December 15, 2023; and Other
assurance and related services engagements beginning on or after December 15, 2023.
y SLAuS 220 (Revised): Effective for audits of financial statements for periods beginning on or after December 15, 2023.
y Issued Non-Authoritative Guidance on Fraud in an Audit of Financial Statements: The Fraud Lens –Interactions Between SLAuS
240 and Other SLAuSs. This non-authoritative guidance illustrates the relationship between Sri Lanka Auditing Standard (SLAuS)
240, The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements, and other SLAuSs when planning and
performing an audit engagement and reporting thereon. It also illustrates how SLAuS 240 is currently applied in conjunction with
the full suite of SLAuSs.
y Published FAQs (Frequently Asked Questions) for Reporting Going Concern Matters in the Auditor’s Report. This non-authoritative
FAQ publication addresses some of the common questions related to reporting going concern matters in the auditor’s report.
Specifically, the publication focuses on the use of and interrelationship of the Material Uncertainty Related to Going Concern and
Key Audit Matters sections, and the Emphasis of Matter paragraphs, in an auditor’s report prepared in accordance with the Sri
Lanka Auditing Standards (SLAuSs).

y Issued and implemented for the first time, a Guide on SLAuS 315 (Revised 2019) Identifying and Assessing the Risks of Material
Misstatement. This guide focuses on the more substantial changes that were made to the International Standard on Auditing 315
(Revised 2019) and will help stakeholders understand and apply the revised standard as intended. SLAuS 315 (Revised 2019) is
effective for audits of financial statements for periods beginning on or after December 15 2021.

Key initiatives undertaken by the CA Sri Lanka - Technical Division in 2022
Focus Area Activity
Sustainability Reporting y Launched the framework for Non-Financial Reporting (NFR). In its capacity as the sole authority
and Non - Financial for issuing accounting and auditing standards in the country, CA Sri Lanka launched the Non-
Reporting Financial Reporting Guideline to strengthen and ensure fair and balanced corporate reporting among
companies, while also promoting non-financial reporting practices amidst growing demands from
diverse stakeholders for enhanced corporate social responsibility. This NFR Guideline was developed
in the interest of promoting reporting best practices among listed and unlisted, as well as large to
small and medium-sized enterprises in Sri Lanka. In this regard, the NFR Guideline is not limited
to the ESG (Environmental, Social, and Governance) framework and covers a broader scope that
encourages companies to report on EESG (Economic, Environmental, Social and Governance)
aspects relevant to their organisations. The NFR Guideline also promulgates some novel concepts
such as the “Core and More Approach” to simplify non-financial reporting practices along with
the “KPI based approach” to improve comparability of quantitative and qualitative non-financial
information. A key benefit of this newly developed guideline which is in line with the international
frameworks for non-financial reporting, is that it provides balanced and flexible guidance on reporting
non-financial information in a way that helps companies to disclose material information consistently
and coherently whilst establishing a common language for non-financial reporting. The framework
also ensures comparability across companies and sectors.
y Appointed a new Committee on ‘Sustainability Disclosure Standards’, in order to provide
recommendations to the Council of CA Sri Lanka, on adoption of IFRS Sustainability Disclosure
Standards in Sri Lanka.
y Signed a three year tripartite agreement to collaborate with the Securities and Exchange Commission
of Sri Lanka and the Colombo Stock Exchange in developing the areas of Integrated Reporting,
Corporate Governance, Sustainability, and any other non-financial reporting areas for the benefit of
corporates and the users of financial statements/corporate reports such as investors and other capital
market stakeholders.
y Submitted comments on IFRS S1 - General Requirements for Disclosure of Sustainability-related
Financial Information and IFRS S2 - Climate-related Disclosures to the International Sustainability
Standards Board.

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