Audit Quality in Australia: The Perspective of Audit Committee Chairs

The Financial Reporting Council and the Auditing and Assurance Standards Board have published the results of a survey of Audit Committee Chairs, which covered 91 of the ASX top 300 listed companies.

The survey copied a UK survey by the UK Financial Reporting Council, to enable a comparison, and is the first time such a survey has been conducted in Australia.

The survey showed a general high level of satisfaction with auditors by Audit Committee Chairs.

Some interesting points to note:
1. HLB Australasia’s listed clients are not in the top 300, and therefore our clients might have a different perspective, and different requirements of us as their auditor.
2. A strong message is that the Audit Committee does not want the auditor will will will to be too close to management.
3. They want the auditor to challenge management’s assessments, and to communicate to the audit committee the auditor’s views on management’s estimates, including communicating alternative views.
4. Audit Committee Chairs auditors to be more innovative, in particular using technology, and data analytics to identify potential issues and enable timely focus.