Preventing Audit Extinction
PCAOB Board Member J. Robert Brown’s speech at Data Amplified has now been published on the Audit Regulator’s website. Mr Brown urges regulators and the audit profession alike to consider the impact of potential irrelevance – “Investors and other consumers of the financial statements are increasingly relying on information not subject to the audit. The effect is the reduction of the significance of the audit and the role played by auditors.”
His speech presents a number of key issues to be considered, but perhaps most importantly, urges all stakeholders to start to have a conversation about the role, and relevance of audit in the face of new information sources for investors and other users. “Concern over quality, the potential for confusion, and the issue of audit relevance suggests the need for a conversation; a conversation that seeks to clarify the role of audit firms, if any, with respect to Non-GAAP, KPIs, XBRL, and sustainability measures.”
Hear hear! Read the speech here and let’s help start the conversation.