Canada enters the ring in the international audit quality debate

As debate on reforms to the audit process rages in the U.S., U.K. and European Union, Canada has a ringside view. But it won’t be enough for Canadian stakeholders to simply observe.

As debate on reforms to the audit process rages in the U.S., U.K. and European Union, Canada has a ringside view.  But it won’t be enough for Canadian stakeholders to simply observe.  Any changes implemented in these jurisdictions will have significant long term implications for the audit process in Canada.  Bottom line?  We need to get into the ring.

To do that the Canadian Public Accountability Board (CPAB) and the Canadian Institute of Chartered Accountants (CICA) have launched a consultation process to gain broad Canadian stakeholder input on key issues emerging with respect to enhancing audit quality globally, and the impact on Canada.  The process is an acknowledgment that while Canada may have avoided large scale failures from the 2008 financial crisis, we will not avoid the repercussions from international audit reform.

An Enhancing Audit Quality Steering Group, under the chairmanship of David Brown, former Chair of the Ontario Securities Commission, is coordinating three working groups dealing with the role of audit committees, the auditor reporting model and auditor independence. The working groups will be examining challenging issues such as:

  • How can auditor reporting to audit committees be enhanced to provide the audit committee with greater insights about the entity, the audited financial statements and the audit process?
  • Should audit committees be reporting to shareholders how they have discharged their responsibility for the integrity of the financial statements and their oversight of the audit process?
  • Which of the reforms to the auditor reporting model being considered internationally will add value to Canadian auditor’s reports?
  • Which options relating to the appointment and rotation of, and services provided by, auditors will improve independence, objectivity, professional skepticism and audit quality at firms?

But the working groups can’t address these issues on their own. They will be publishing papers for comment starting in the summer dealing with issues affecting all stakeholders in the financial reporting process.  They need strong input if Canada’s views are to resonate internationally. 

Are you in their corner? If so, you need to find out more about the CPAB/CICA initiative – Enhancing Audit Quality: Canadian Perspectives and get engaged.

Keep the conversation going…Tell me what Canada should be saying at the international audit quality debate. Email me directly.

Eric

Conversations about Audit Quality is designed to create an exchange of ideas on global audit quality developments and issues and their impact in Canada.


This was originally published by one of CPA Canada’s legacy bodies.


About the Author

Eric Turner, CPA, CA

Director, Auditing and Assurance Standards, CPA Canada

Highlights

Update your knowledge and strengthen your network at this must-attend conference covering the most important issues and trends affecting audit committee members.

It’s probable that someone you know is deep in debt. If you are observant, you might see one of these seven signs.