JUST 33% of audit committees report on the assessment and effectiveness of external auditors, despite guidance in the UK Corporate Governance Code.
BDO’s new survey shows only 32% of reports detail the provision of non-audit services, and the firm claims shareholders are therefore lumped with “inconsistent information” and little explanation of the audit tendering process and contractual terms.
Senior audit partner James Roberts said: “UK corporate governance sets the standard worldwide, but audit committee reporting is short of where the regulators want it to be in the future.”
Inconsistent quality and boiler-plating does nothing to reassure investors and our research highlights the significant divide between what is expected of audit committees and where many actually are now.”
The firm analyzed the annual reports of 237 listed companies to see how audit committee work was documented, saying “excellent examples of best practice” were most notable when audit committee chairs wrote separate reports themselves.
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Despite the high levels of tendering and rotation, the Big Four’s share of the FTSE 350 market has risen from 96.7% to 97.4%, the FRC finds