As we all await the EU vote on audit reform, firm leaders seem to have given into the idea that change is coming and despite vigorous opposition from the mid-tier and the Big Four, mandatory audit firm rotation is something all firms will have to tackle in the coming years.
At the annual International Accounting Bulletin World Survey Round Table at the end of January, global and regional network and association leaders agreed mandatory rotation was not a desired outcome. Politicians and EU legislators may be partly to blame, however the lack of ‘speaking with one voice’ as a profession throughout the four-year audit reform process could have had something to do with the pending outcome.
While the Big Four and larger mid-tier firms were battling each other on provisions such as mandatory retendering, non-audit services restrictions and joint audits, mandatory rotation crept in as a sensible solution from the point of view of European politicians.
Perhaps there are some lessons to be learned from the past few years, especially as there might be several more changes ahead for the profession.
And one of the lingering issues yet again exposed at this year’s Round Table is how to ensure audit and auditors remain relevant. Perhaps working against the increased commoditisation of audit and ensuring it addresses the current needs of users is a fresh test for the profession and its ability to work together?
The hope of many, I’m sure, is that this time round it won’t be left to the politicians, however in order to ensure this is not the case more assertive call for change might be needed from the profession and a desire to make a difference before it is too late.
World Survey launch
Accompanying the World Survey Round Table each year is also a public launch event, which saw the presentation of the key finding of the IAB World Survey. This year the event was kindly hosted by the Association of Chartered Certified Accountants in London to which we own a big thank you for helping us with our preparations and welcoming more than 70 guests. The Survey also attracted media attention with some of the key findings and historical data comparisons receiving media coverage globally by The Financial Times, Reuters, The Washington Post, The Sydney Morning Herald and many more. In case you missed the event this year we look forward to welcoming you next year.