Company owners call for more colourful audits

Company owners have called for audit reports with greater detail at a
conference on the Quality of Public Company Audit.

Speaking as a panel member at the conference, Peter Butler, CEO of Governance
for Owners, said reports should contain: the range and skills of audit committee
members; the performance review of an audit committee; along with details of
meetings they had attended and what they covered during those meetings in the
course of their duties.

‘The report should also cover the appointment of auditors, the frequency of
tenders, the tendering process and the engagement letters, as well as
contingency plans,’ said Butler.

Similar calls for more colourful audit reports, with detailed expressions of
the controversies and arguments that lead to an audit’s sign-off, rather than
bland boilerplate statements, were made last year by the ICAEW’s Audit Quality
Forum, headed by Gerald Russell.

Other panel members, at the conference hosted by the International
Organisation of Securities Commissions, also discussed ways of improving audit
quality by making auditors’ reports more relevant to investors by disclosing key
business metrics.

Suggestions were also made, during the panel discussion on the evaluation of
external audits. It was suggested that internal audit functions could be relied
upon in large companies to aid the external audit under oversight of audit
committees.