3.5 Relationship between International Standards of Auditing and National Auditing Standards

The relationship between International Standards on Auditing (ISAs) and National Auditing Standards can vary depending on the jurisdiction. Here are a few common scenarios:

1. Adoption and Incorporation: Many countries adopt the ISAs in their entirety as the national auditing standards. In such cases, the ISAs are directly applicable and enforceable within the country. The national auditing standards essentially mirror the ISAs, with little or no modifications made.
2. Convergence: Some countries have adopted a convergence approach, where they align their national auditing standards with the ISAs while making certain modifications to address local legal, regulatory, or cultural requirements. The goal is to achieve a high level of harmonization with the ISAs, ensuring consistency in auditing practices while considering jurisdiction-specific factors.
3. Reference and Supplementary Guidance: In certain jurisdictions, the national auditing standards may reference the ISAs as a source of authoritative guidance but provide additional or supplementary requirements specific to the country. These additional requirements may be related to legal or regulatory provisions, cultural considerations, or specific industry practices.
4. Dual Reporting: In a few cases, jurisdictions maintain separate sets of national auditing standards alongside the ISAs. In these instances, auditors may be required to comply with both sets of standards, resulting in dual reporting. The national auditing standards may provide additional guidance or requirements that are not covered by the ISAs.
5. Interpretation and Implementation Guidance: National auditing standards may include interpretation and implementation guidance specific to the jurisdiction. This guidance helps auditors understand and apply the ISAs in the local context, providing clarity on how to implement the standards effectively.