Auditor-regulator talks might benefit from code
KPMG suggests code to manage relationship with regulators
KPMG suggests code to manage relationship with regulators
A code of conduct should be introduced to manage the relationship between
regulators and auditors of banks, according to the head of Big Four firm KPMG.
Insider
Blog: Falling out of love – auditors and regulators
John Griffith-Jones, KPMG senior partner, said the relationship between bank
auditors and regulators “might benefit” from a set of protocols, in a submission
to a House of Lords investigation into audit competition.
In his submission, seen by Accountancy Age, Griffith-Jones said
there should be no limitations on client information shared between regulators
and auditors.
“The difficulty is in filtering and identifying the key issues from such a
volume of information,” he said in the submission.
“This whole area might benefit from a code of conduct or a set of protocols
which formally recognises the respective roles and responsibilities of all
different parties.”
The House of Lords is investigating the sometimes fractious relationship
between auditors and regulators. The relationship between the Financial Services
Authority (FSA) and auditors has deteriorated since the introduction of the
tripartite system in 1997.
In July the FSA criticised auditors for failing to report under whistle
blowing legislation. Richard Thorpe, accounting and auditing leader at the FSA,
told Accountancy Age in July that auditors “rarely report to us under
their whistle blowing obligation.”
“They argue that this is because they get their clients to inform us of
problems, but we believe it would be better for the auditor to inform us
himself,” he said at the time.
Further Reading:
New
FSA powers will force auditors to speak out