The future of Audit
According to recent statements of David Sproul, CEO of Deloitte, the future of audit will require a change in thinking from auditors, investors and companies.
Definitely, Audit International, the leading specialists in Internal and External Audit Recruitment across Europe, the US and Asia will accompany and advise its clients and candidates through that process of change.
Mr. Sproul also said that the audit industry was already changing, in spite of facing criticism in the years since the financial crisis for “not spotting the impending crash”.
The chief executive of the big four audit firm considers that facts as changes in the EU audit market or the investigation by the Competition and Market’s authority and the FRC’s Corporate Governance Code have started to take effect leading the audit industry to a “material and enduring increase in audit tenders”.
As an example he mentioned that within the Britain market, more than 50 of largest companies have put their audit out to tender in the last couple of years. Concerned, he added that historically they would have expected to see less than a quarter of that number”
He defined the competition among the leading audit firms as intense and specified that every tender is hard fought. In Mr. Sproul’s opinion, as a consequence of this increasing competition the audit profession must become “more active and forward thinking”
He also mentioned that the introduction of extended reporting is improving their relation with investors since reports now provide a higher level of relevant information and increased transparency around the auditing process.
Another key fact for the future of the audit industry will be technological improvements. The use of new tools will auditors led to increase performance and make them better able to alert investors to “unusual trends and anomalies.”
Audit firms have improved the service they offer clients and investors by providing assurance outside regular reporting periods. Related to this fact, in Mr Sproul’s opinion “There is no reason why auditors couldn’t provide assurance on preliminary statements, data from investor roadshows and other updates.”
He considers also crucial to the role of the external auditor the integrated reporting, in which a business addresses not only its financial resources but also people, society, the environment and infrastructure.
To sum up, he concluded: “If a business creates value for others, in the long term, this creates value for the business. External auditors should provide comfort that management commentary is of investment grade quality.”
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