The big question - FDs say audit regulation is too weak.
Just one in four finance directors believe the current regulatory system for auditors is strong enough to prevent conflicts of interest. The damning verdict comes in this week’s Big Question survey conducted by Accountancy Age with Reed Accountancy Personnel. Only 27% said the current system was strong enough. Some 44% said regulations weren’t sufficiently secure, with the rest neutral. The survey followed news that a UK inquiry into audit independence may be launched following a US probe. And FDs said they were concerned that extensive Big Five interests made conflicts likely. ‘Conflict of interest will arise in all professions and auditing is no different. No amount of regulation can prevent the conflict,’ said Paresh Samat, FD of employment services company SBJ ESS. But Stuart Chapman FD of International Baccalaureate, said the current system was good enough. ‘There will always be cases of inappropriate conduct but the medium and large-sized firms have too much to lose by crossing the line,’ he said.