STOP PRESS!
REAL CHOICE?
"If you're thinking of getting all the big-4 firms to compete on your tender you may be in for a surprise. Audit Review have already encountered situations where firms have declined due to a high level of profitable consultancy fees or because after assessing the risk and the work required to respond professionally they have judged these too high. Add to that conflicts with other services such as tax and internal audit and things may narrow considerably. Now a new factor has emerged. There are so many tenders taking place that big-6 firms may be reluctant to respond to tenders in their 'busy season' between January and March.

Those who don't have a December year end need to consider the timing implications. Management of the relationships with audit firms together with a sound tender strategy and a robust timetable are going to become even more critical."

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Coming soon - The EU audit regulation: the definitive guide for Public Interest Entities


Audit Committee Briefing Note - MaterialityAudit Committee Briefing Note - Materiality
BRIEFING NOTE

Issued January 2014- © Audit Review
Author: Audit Review - PDF 538KB

Audit Review has long called for greater transparency of information about how materiality levels are set and revised by external auditors. We believe that by doing so users of the accounts will better understand the level of comfort that an audit brings. The Financial Reporting Council (FRC) has just published its first ‘Thematic Review’1 which builds on recent changes to the audit report. The Review has been sent to FTSE350 Audit Committee Chairs with encouragement to consider the content of the report.

This paper is intended to provide an overview briefing for Audit Committees.


FRC Consultation on Changes to the Auditor’s ReportFRC Consultation on Changes to the Auditor’s Report
TECHNICAL NOTE

Issued June 2013 - © Audit Review
Author: Audit Review - PDF 714KB

On 4 June 2013, the Financial Reporting Council ('FRC') published revisions to ISA (UK and Ireland) 700 covering the auditor's report for entities which are subject to the UK Corporate Governance Code ('the Code').  This requires the auditor’s report to address three new critical areas: risks of material misstatement, materiality and the audit scope.

The Consultation Paper contains some illustrative Auditor’s Report Disclosures.


Competition Commission’s Insight on FDs and ACCsCompetition Commission’s Insight on FDs and ACCs
PUBLISHED ARTICLE

Issued February 2013 - © Audit Review
Author: Audit Review - PDF 711KB

The Competition Commission's enquiry into Statutory Audits has involved in-depth qualitative and quantitative research . Because this focused on Finance Directors or equivalent (FDs) and Audit Committee Chairs (ACCs) their divergence of opinions is a fascinating bi-product of the results.

This paper explores the nature and extent of this divergence in four crucial areas: [1] Audit quality vs. cost [2] Assessing audit quality [3] Influence in auditor selection [4] Auditor selection criteria.


Reviewing or Tendering your External Audit - cover imageAudit tendering: the requirements of the Revised Code and Guidance on Audit Committees
TECHNICAL NOTE


Issued September 2012 - © Audit Review
Author: Audit Review - PDF 699KB

In September 2012, the Financial Reporting Council ("FRC") published revisions to the UK Corporate Governance Code (“the Code”) and revised Guidance on Audit Committees (“the Guidance”).  The Guidance is designed to assist company boards in making suitable arrangements for their audit committees, and to assist directors serving on audit committees in carrying out their role. While boards are not required to follow this guidance, it is intended to assist them when implementing the relevant provisions of the Code.

This technical note looks at the key issues that the FRC will shortly discuss with audit committee chairs, finance directors, audit partners and investors.


Reviewing or Tendering your External Audit - cover imageWhich Businesses Need an Audit?
TECHNICAL NOTE

Issued September 2012 - © Audit Review
Author: Audit Review - PDF 704KB

In September 2012, the Department for Business Innovation & Skills (BIS) announced changes to the exemptions from audit for certain UK companies and Limited Liability Partnerships (LLPs). According to BIS nearly 200,000 smaller private companies, subsidiaries and dormant companies would not now need an audit, saving millions of pounds in audit fees.

This technical note reviews and offers insight into the requirements and exemptions affecting small companies, dormant companies and subsidiary companies.


Reviewing or Tendering your External Audit - cover imageAuditor Independence Policy
Why Auditor Independence Matters

Published May 2012 - © Audit Review
Author: Audit Review - PDF 687KB

Demonstrating that an auditor is independent of the company it audits is a core plank of corporate governance and is vital in achieving objectivity. It provides stakeholders with confidence in the company’s financial reporting. Developing and adhering to a strong policy on auditor independence is essential.

This white paper examines the issues involved in establishing auditor independence and contains a specimen policy on Auditor Independence for use by a typical UK listed company


Reviewing or Tendering your External Audit - cover imageReviewing or Tendering your External Audit
The Corporate Governance Considerations

First Published March 2012 - © Audit Review
Revised October 2012 - © Audit Review
Author: Audit Review - PDF 609KB

The Enron scandal in 2001 combined with similar scandals at Worldcom and Global Crossing and the subsequent collapse of Arthur Andersen, one of the ‘Big 5’ firms of auditors at the time, has led regulators around in the world to tighten rules around the appointment of external auditors and how audits should be performed...

This white paper explores the history of UK Corporate Governance and how current and future compliance codes will affect audit procedures.