This is the third year that Chartered Accountants Australia and New Zealand (CA ANZ) has examined the reporting of key audit matters (KAMs) in collaboration with the University of Melbourne, and the University of Queensland. Building on our two previous publications in 2022 and 2021, this research examines the frequency and nature of the reporting of KAMs in Australia by ASX listed companies that issued financial statements in 2023 (balance dates between 31 December 2022 and 30 September 2023).

Some of the key findings are as follows:

• Auditors report an average of 1.84 key audit matters per audit report. The number of KAMs in an audit report range from a low of 0 through to a maximum of 6.
• Most audit reports have one or two KAMs and very few report zero or more than four. 
• There were 54 distinct KAM subject matter areas identified, which suggests a broad range of topics are significant to the audit of a financial report. 
• The most frequent KAM subject matter was impairment, representing 18% of all KAMs. The next most frequent areas in order were: exploration assets (18%); revenue (12%); business combinations (8%); share-based payments (7%); inventory (4%); intangibles (3%) and provisions (3%). 
• Topics such as information technology, (which usually involved the implementation of a new IT system), fraud risk (due to risk of fraud in recognition of revenue), related party transactions and funding & liquidity appear less frequently.