PracticeAuditCall for simultaneous reporting

Call for simultaneous reporting

KPMG’s head of audit says audit inspection reports should be published simultaneously or they risk opening some firms up to more attention than others

All audit inspection reports on named firms should be published
simultaneously or risk opening some firms up to more attention than others,
according to KPMG’s head of audit.

Richard Bennison makes the point writing in today’s Accountancy Age
where he lays out the four conditions for a ‘properly’ managed audit inspection
procedure.

It was revealed in June that firms subject to inspections will now be named
when reports are published, as happens in the US.

Bennison writes that ‘the report should be published simultaneously, on as
many firms as possible. Otherwise (as happened in the US), there is far more
interest in the first report to be published than the last, and it effectively
becomes an uneven playing field.’

Another three conditions are outlined by Bennison including the need for
audit firms to see the inspection reports to note good work as well as bad.

He also wants firms to see a draft before the reports are published and
advises that the clients should not be named.

Bennison describes the move to name auditors as ‘good for market confidence’
but says his four points form ‘an important caveat’.

Previous inspection reports, which did not name the audit firms concerned,
were accused of maintaining the ‘myth’ that there was quality difference between
Big Four and mid-tier auditors.

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