Forward-looking information and business model risk should be the focus of audits, according to a report by ACCA.
In Reshaping the Audit for the New Global Economy, ACCA’s key findings were a need for audit to be broadened in scope, greater communication of findings for investors and other stakeholders, plus reporting around real-time information.
Auditor liability will need to be addressed if real change is to happen, as a broader more forward-looking audit model will increase risk to the profession.
ACCA’s report took on board a number of roundtables across the globe I the last year.
Ian Welch, head of policy at ACCA, said: “It was clear from our events that the audit function is still believed to add considerable value to business by increasing confidence in financial statements. But there was also a clear sense of frustration that more could be done to meet stakeholder needs and that the considerable work that goes into an audit should be better communicated.
“But they key problem is to find an answer to the liability issue. Delegates consistently stated that this was a roadblock to innovation and to auditors taking on further responsibilities.
“The global round-table series has shown there is, overall, a positive view of what audit can bring to economies. It is essential in the years ahead that the profession, policymakers and other stakeholders set out a path way to overcoming some of the issues this series has identified.”
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