The Brydon Review will be “incredibly influential” beyond the UK, said Amir Ghandar, Reporting & Assurance Leader at CA ANZ.
“It is the most comprehensive review into audit conducted internationally in recent history,” he said.
The landmark final report, which was released yesterday [Wed], has uniquely brought together different elements of the audit quality debate and seeks to address the fundamental issues across the reporting and assurance ecosystem.
The report’s focus areas are relevant to the debate in Australia, including the parliamentary inquiry into audit, the Banking Royal Commission, wage payment issues and anti-money laundering breaches.
“The solution to these challenges must be strengthening of accountability, systems and controls – the lines of defence serving to address risks facing businesses and consumers,” Ghandar said.
“Boards, audit and risk committees, management, CFOs and auditors all have a role to play.”
Among the review’s proposals is the creation of a new ‘corporate auditing’ profession which would include subject-matter specific auditor qualifications.
“This goes hand in hand with an extension of the concept of auditing to areas beyond financial statements,” Ghandar said.
He said the report also goes a long way to enhancing transparency by recommending audit fees be shown as a separate line item in profit or loss accounts (and treated like dividends), disclosure of the number of hours spent on the audit, and that firms publish financial statements for their audit practice.
“Many of the recommendations are in line with CA ANZ’s 15-point plan handed down to the Australian parliamentary inquiry into audit, including greater transparency and strengthening independence and confidence.
“This will transform accountability for risks facing investors and the public, including risk of failure, fraud, and environmental, social, and governance issues.”
The Australian parliamentary inquiry into regulation of audit
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