Audit needs to respond more quickly to change, evolve or die
Roundtables point to concerns over audit in developed countries.
A series of roundtables held by ACCA and Grant Thornton in seven countries across the world has revealed a series of highly diverse opinions on the current and future position of audit.
The report, The Future of Audit, showed that in countries where audit is still developing, it was valued far more highly than in countries where it is has been long established.
In developed countries there were strong views that while the audit and assurance process was important it was neither timely nor did it offer insights as to where businesses could have done better.
Andrew Gambier, ACCA head of audit and assurance, says: ‘There is a definite feeling that the traditional audit process is not delivering enough. Investors want insights on how a company could have addressed risks better or where they could have maximised profits. Although enhanced auditor reporting has gone down well in the UK, and is now being rolled out elsewhere, there’s a belief that the audit should evolve to allow auditors to provide more valuable insights about a wider range of measures.
‘While the traditional approach might reassure regulators and company bosses, its usefulness to investors is shrinking all the time, prompting questions over its future. Business leaders expect information in real time, so why do we expect investors to wait months for the audit reports?
‘Auditors need to look at how they can use technology to deliver a high quality audit in a more efficient and timely manner.’
The roundtables showed that while there are advantages to developing global rules, standard setters should be sensitive to the fact that countries are evolving at a different pace.
Nick Jeffrey, Director, Public Policy at Grant Thornton International, says: ‘We heard views from investors, companies, regulators and banks. While audit remains valued the world over, there was a striking message. Jurisdictions with a long history of audit said the future was in assurance on a broad range of data; which contrasted with those with a shorter audit history who want a stable body of rules to enable them to maximise benefits. The implication for global rule makers being that one pace of development will not suit all.’
The roundtables that informed The Future of Audit were held in China, the EU, Singapore, South Africa, the UAE, the UK and Ukraine.