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Independent Review calls for views into the quality and effectiveness of audit.

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18 Apr 2019

The Independent Review by Sir Donald Brydon, which seeks to examine the existing purpose, scope and quality of statutory audit in the UK, is seeking views, supported by evidence where possible, on the extent of assurance that statutory audit in the UK currently provides to the users of financial statements, and how it might develop to meet better those users’ needs to serve the interests of other stakeholders and the wider public interest.

Views are particularly sought on how the statutory audit of Public Interest Entities could be improved to provide greater assurance to shareholders and other stakeholders, in view of the significant economic and social impact that such organisations have.

The Independent Review is primarily interested in questions around the purpose, scope and quality of audit, rather than the specific role of the audit regulator or the market through which audit services are provided. These other two areas are being addressed, respectively, in the Government’s initial response to Sir John Kingman’s Independent Review of the Financial Reporting Council, and in the Competition and Market Authority’s on-going market study into the statutory audit market. However the Independent Review will take the recommendations of those other reviews into account.

Specifically the Independent Review calls for views, information and evidence on:

  • the purpose of audit and for whom it should be carried out;
  • whether its scope and purpose should be widened and strengthened to meet changing expectations of audit;
  • how the quality of the audit process and product could be improved;
  • whether audit findings could be better communicated;
  • the role of audit within wider business assurance and in relation to directors’ legal responsibilities;
  • the role of audit in detecting fraud; and
  • auditor liability.

The comment deadline is 7 June 2019.

The full report is available on the the Department for Business, Energy and Industrial strategy (BEIS) website here.

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