EY to improve audits via independent panel

EY to improve audits via independent panel

EY are responding to calls for independence among the Big Four accounting firms

While the struggle around audit quality in the Big Four accounting firms continues on, EY have created a new Independent Audit Quality Committee (IAQC).

The panel was announced by EY’s US partnership on Wednesday to provide an independent, outsider’s view on the quality of their audits, including any operations, strategy, and culture relating to it.

Consisting of three experts, the panel was chosen from groups that EY deals with regularly who rely heavily on its audit work, like investors, corporate audit clients, and regulators.

It can now be revealed that those on the panel include Jeanette Franzel, former public company accounting oversight board member, William McNabb III, former chairman and CEO of Vanguard, and Charles Noski, former Bank of America chairman and executive vice president.

McNabb will lead as chairman of the committee.

The independence of the big accounting firms has been a hot topic of discussion for a number of years, and continues to grow with recent audit scandals such as Carillion.

Experts say these firms should be subject to independent reviews of the audits they conduct.

Kelly Grier, EY US chairman, managing partner and Americas managing partner, said: “At EY we believe in the power of diverse points of view in all aspects of our business.

“Leaders of the [Securities and Exchange Commission] have also observed the benefits of independent and diverse thinking brought by outside leaders to support audit quality and the public interest.”

As this change comes in, the government’s Business, Energy, and Industrial Strategy Committee has heard evidence from John Kingman as well as investor representatives and academics on implementing actions aiming to improve audit quality in the UK.

Kingman has called once again for the abolition of the audit profession’s watchdog, the Financial Reporting Council (FRC), saying it should go “as swiftly as possible”.

In his review at the end of last year he said the creation of an Audit, Reporting, and Governance Authority in place of the FRC should be implemented by the government.

Whitepaper

The Future of Finance is in the CFO's Hands

Business The Future of Finance is in the CFO's Hands

1m
Save a Week a Month Consolidating Accounts

Accounting Software Save a Week a Month Consolidating Accounts

2m
Mitigating Risk Through Internal Control

Legal Mitigating Risk Through Internal Control

3m
Could tax season have run more efficiently?

Corporate Tax Could tax season have run more efficiently?

3m

Related Articles

KPMG UK announce new audit structure – but is it enough?

Audit KPMG UK announce new audit structure – but is it enough?

6d Tom Lemmon
The CMA has released its final report into the future of the audit market

Audit The CMA has released its final report into the future of the audit market

1m Beth McLoughlin, Managing Editor
The madness of audit independence

Audit The madness of audit independence

1m Clive Viegas Bennett, CEO of MGI Worldwide
Life after BHS, Carillion, & Patisserie Valerie: Is there light at the end of the tunnel for audit?

Audit Life after BHS, Carillion, & Patisserie Valerie: Is there light at the end of the tunnel for audit?

1m Lucy Skoulding, Reporter
Audit vs R&D: “There is a clear conflict which accountancy firms aren’t dealing with”

Audit Audit vs R&D: “There is a clear conflict which accountancy firms aren’t dealing with”

2m Beth McLoughlin, Managing Editor
Top accounting scandals in 2018

Audit Top accounting scandals in 2018

2m Virginia Blackburn
Sir Donald Brydon appoints team for his audit review

Audit Sir Donald Brydon appoints team for his audit review

3m Beth McLoughlin, Managing Editor
Patisserie Valerie rescued in management buyout backed by Causeway Capital Partners

Audit Patisserie Valerie rescued in management buyout backed by Causeway Capital Partners

3m Lucy Skoulding, Reporter