PracticeAuditMid-tier firm calls for auditor restrictions

Mid-tier firm calls for auditor restrictions

A mid-tier accountancy firm has thrown down the gauntlet to the UK accounting profession, demanding massive restrictions on auditors that sell other services to their clients.

In a hard-hitting report, RSM Robson Rhodes has called on the newly established Accountancy Foundation to set out clear boundaries on non-audit work that could be provided to clients.

In addition, the firm argued that all significant non-audit work should have to be approved by a company’s audit committee, backed by a full analysis published in its annual report.

The report, Asserting Independence, said: ‘There is real concern about the extent to which auditors are selling other services to their clients and that this can stop them being tough when toughness is needed.’

The move will be seen as a challenge to the accountancy profession, in particular the ICAEW, which is currently debating its policy on independence and the rotation of audit firms. Robson Rhodes called for a company’s audit to be put out to tender at least once every five years.

The firm’s technical partner, Anthony Carey, who until recently was technical director at the ICAEW, said: ‘To avoid another Enron, we need a governance system that prevents problems rather than one that corrects them.’

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