Sue Almond, technical director says: 'The issue for ACCA is about ensuring that the audit report focuses on the need of investors – this was a point made in a recent report by ACCA and Grant Thornton called Putting investors at the heart of the financial system. But this is a real challenge also for the preparers of the audit report. We urge them, and investors, to offer their feedback to this important global consultation too.'
ACCA has already been working on the future scope of the auditor’s report. This issue was considered at a roundtable for investors held in May.
The roundtable showed that:
- Investors felt the market structure had failed in relation to the provision of audit services and some regulatory intervention was needed.
- Auditor reporting needed to be enhanced with more information given on audit judgements.
- The role of audit committees in representing shareholder interests in the audit process was crucial. Some audit committee chairs needed to be more aware of this and 'open up' more to investors.
- While there should be an upper limit on the length of an auditor's tenure, audit committees should be given considerable flexibility to justify the retention of auditors to that limit.
Sue Almond adds: 'Our discussions have shown that investors place a great deal of importance on the role of the audit committee to represent their interests. As one institutional shareholder pointed out at our recent roundtable: We cannot speak to all the auditors of companies we hold shares in. We have to trust the audit committee – they should be accountable to shareholders and explain why a firm is being kept on. We have to rely on the audit committee to stand in our shoes and to represent our interests in calling the auditors to account and ensuring the auditors are doing their jobs properly and effectively.’
Sue Almond concludes: 'Investors should be the primary focus for global financial and accounting standards, yet their voices are not being clearly heard. What the audit profession should be aiming for is transparency and measures to meet the needs of shareholders. This is a timely consultation and ACCA will be making a full response by the deadline of 8 October 2012.'
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For more information, please contact:
Alana Sinnen, ACCA Newsroom
+ 44 (0) 207 059 5807
+44 (0) 7715 812120
Helen Thompson, ACCA Newsroom
+44 (0)20 7059 5759
+44 (0)7725 498654
Notes to Editors
- ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants. We aim to offer business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management.
- We support our 154,000 members and 432,000 students in 170 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. We work through a network of over 80 offices and centres and more than 8,400 Approved Employers worldwide, who provide high standards of employee learning and development. Through our public interest remit, we promote appropriate regulation of accounting and conduct relevant research to ensure accountancy continues to grow in reputation and influence.
- Founded in 1904, ACCA has consistently held unique core values: opportunity, diversity, innovation, integrity and accountability. We believe that accountants bring value to economies in all stages of development and seek to develop capacity in the profession and encourage the adoption of global standards. Our values are aligned to the needs of employers in all sectors and we ensure that through our qualifications, we prepare accountants for business. We seek to open up the profession to people of all backgrounds and remove artificial barriers, innovating our qualifications and delivery to meet the diverse needs of trainee professionals and their employers.