Corporate governance

Audit / Over a third of audits fail quality test, says IFIAR

One in three audits carried out by member firms of the six largest global audit networks are judged deficient in some way with fair value judgment frequently cited as a key problem area, finds global audit regulatory forum

Audit / Audit and quality management: ISQM 2 – part 3

In the third part of our series on reforms to auditing standards, Katharine Bagshaw FCA examines the exposure draft on International Standard on Quality Management (ISQM 2) Engagement Quality Reviews, including its applicability for smaller firms

Audit / Only one in four understand role of auditors

Only one in four people in the UK know what an auditor does, compared to a worldwide average of one third, while over half of those in an ACCA poll believed it is auditors who are responsible for avoiding company failures

Audit / ‘Opinion shopping’ for auditors reduces business red flags

Over half of US businesses facing financial problems go ‘opinion shopping’ for auditors to try to override unfavourable going concern opinions at the expense of auditor independence and investor interests, a US study has found

Audit / Law firms fail to tackle money laundering robustly

A significant number of law firms are not doing enough to prevent money laundering, with some falling seriously short, leading to disciplinary action by the regulator

Audit / FRC fines MSR Partners £825k over deficient Laura Ashley audit

The Financial Reporting Council (FRC) has fined MSR Partners (formerly Moore Stephens LLP) and Stephen Corrall, audit engagement partner, in relation to an audit of fashion and homeware retailer Laura Ashley, which the regulator said was  ‘deficient in numerous respects’

Audit / Swabey: fundamental problem with audit needs urgent reform

Attempts to improve audit and scandal-proof the audit process will be futile unless the basic issues of education, training and trust are first addressed, while simply forcing challenger firms into the mix will not solve the fundamental problem, argues Peter Swabey, policy and research director at ICSA: The Governance Institute

Audit / FRC fines KPMG £5m over Co-Op Bank audit failings

The Financial Reporting Council (FRC) has fined KPMG £5m, severely reprimanded the firm and imposed additional requirements on its auditing of credit institutions for the next three years, for misconduct in its audit of the Co-operative Bank in 2009

Accounting / Kraft Heinz admits $181m in accounting ‘misstatements’

US food giant Kraft Heinz has revealed it will have to restate almost three years’ worth of accounts after an internal review found ‘certain misstatements’ meaning an estimated $181m (£138m) will have to be restated

Audit / Audit: will any reform make a real difference?

Despite nine Companies Acts in the 20th century, and numerous reviews, nothing has changed to prevent audit failure. Instead of changing the law, David Duvall argues for a change in cultural mindset to overturn auditor complacency and lack of management scrutiny, and clamp down on excessive dividend payments

Audit / Anglo American swaps Deloitte for PwC in £7m audit switch

Multinational mining giant Anglo American has hired PwC as its new external auditor, taking over from Deloitte which has been in post for 19 years

Audit / Wearden: time to overhaul scrutiny of audit committees

In the wake of the BEIS committee report on the future of audit, Mark Wearden, director of MBS Governance, questions whether a one-size-fits-all approach to audit committee regulation will tackle expectation problems and improve effectiveness and oversight

Audit / NAO issues guidance for audit committees on cloud services

The National Audit Office (NAO) has published guidance for audit committees on cloud IT services and their use in government, with suggested questions to ask at planning, implementation and management stages

Audit / KPMG fined £6m over Lloyds syndicate audit failures

Big Four firm KPMG has been fined £6m by the Financial Reporting Council (FRC) following a long running investigation by the regulator into misconduct in the firm’s auditing of a Lloyds syndicate

Audit / Audit updates: May 2019

In this month’s audit updates, the Competition and Markets Authority (CMA) sets out radical reform proposals including mandatory joint audits, Brydon review launches audit process consultation, the future of the Financial Reporting Council (FRC), review of KPMG’s audit practice, sanctions for Grant Thornton and Baker Tilly, and audit switches at Mothercase and French Connection
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