PracticeAuditAnnual reports face harsher auditor scrutiny

Annual reports face harsher auditor scrutiny

Companies will have to provide more evidence to show they have sufficient finances to cover activities in 2008

Companies will be under more pressure from auditors and have to provide
greater evidence to show they have sufficient financing for their business
activities in 2008 as a result of the liquidity crisis.

Auditors have warned they will apply extra scrutiny of a company’s viability,
including its access to credit for 2008 as a sign the credit crunch is spreading
beyond the financial sector.

‘Many of the normal assumptions can’t be taken for granted so while we always
tested them, this year needs particularly high levels of challenges – we are in
a new world,’ Martyn Jones,
Deloitte
UK national audit technical partner, told Financial Times.

Andrew Ratcliffe, PricewaterhouseCoopers
audit partner, said the effects of the credit crunch went across the whole
economy but no one yet knew how it would pan out. For auditors, this means a
whole range of questions to be asked before approving annual reports and giving
companies a clean bill of health.

Further reading:

Morgan Stanley reviews risk officer position

BDO: FDs uncertain in current credit crunch

Read
story in the Financial Times

Related Articles

Is predictive analytics the end of the annual audit?

Audit Is predictive analytics the end of the annual audit?

3d Martin Herron, MHA MacIntyre Hudson
Auditors ‘in the dock’ over Carillion as report calls for Big Four break-up

Audit Auditors ‘in the dock’ over Carillion as report calls for Big Four break-up

1w Emma Smith, Managing Editor
PCAOB sanctions former Deloitte Turkey CEOs over altered documents

Audit PCAOB sanctions former Deloitte Turkey CEOs over altered documents

2w Alia Shoaib, Reporter
KPMG South Africa to review past audit work amid fresh scandal

Audit KPMG South Africa to review past audit work amid fresh scandal

1m Alia Shoaib, Reporter
FRC introduces £10m sanctions for Big Four firms

Audit FRC introduces £10m sanctions for Big Four firms

1m Alia Shoaib, Reporter
Ukraine’s PrivatBank files $3bn claim against PwC

Audit Ukraine’s PrivatBank files $3bn claim against PwC

2m Alia Shoaib, Reporter
Grant Thornton to exit FTSE 350 audit market, citing Big Four dominance

Audit Grant Thornton to exit FTSE 350 audit market, citing Big Four dominance

2m Alia Shoaib, Reporter
Big Four dominate FTSE 250 audit market in Q1 rankings

Audit Big Four dominate FTSE 250 audit market in Q1 rankings

3m Alia Shoaib, Reporter