As a Recognised Supervisory Body for audit, ICAEW monitors the work of firms of all sizes, from sole practitioners to the Big Four – in total about 2,400 firms – and reports on its findings annually. Most visits conclude without the need for further regulatory action.
PSD completed 555 audit monitoring review visits, incorporating the review of firms’ work on 1,056 audits, between April 2021 and March 2022.
The report found there was a drop in the percentage of audits requiring significant improvement to 4%, down from 7% in 2020-2021.
At 76% the percentage of audits found to be good or generally acceptable remained the same, reflecting continuity in audit quality standards from 2020-2021.
Rama Krishnan, Chair of ICAEW’s Audit Registration Committee, said:
“Since September 2021 most audit monitoring visits have once again been conducted onsite, which has been a key factor in the effectiveness and efficiency of PSD’s monitoring work.
"We’re pleased that our annual review has found a sharp drop in the percentage of audits requiring significant improvement. If this trend is sustained by firms reviewed in 2022-2023 and beyond this is a very positive development.
“But work remains on audit quality standards, which need to be improved, and the profession must focus on increasing these in the year ahead.”
Notes to editors:
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The full report is available here.
ICAEW’s regulatory and conduct roles
Our role as an improvement regulator is to strengthen trust in ICAEW Chartered Accountants and firms. We do this by enabling, evaluating and enforcing the highest standards in the profession.
ICAEW’s regulatory and conduct roles are separated from ICAEW’s other activities through internal governance so that we can monitor, support or take steps to ensure change if standards are not met. These roles are carried out by the Professional Standards Department (PSD) and overseen by the ICAEW Regulatory Board (IRB).
- authorise ICAEW firms, members and affiliates to undertake work regulated by law: audit, local audit, investment business, insolvency and probate;
- support the highest professional standards in general accountancy practice through our Practice Assurance scheme;
- provide robust anti-money laundering supervision and monitoring;
- monitor ICAEW firms and insolvency practitioners to ensure they operate correctly and to the highest standards;
- investigate complaints and hold ICAEW firms and members to account where they fall short of standards;
- respond and comment on proposed changes to the law and regulation; and
- educate through guidance and advice to help stakeholders comply with laws, regulations and professional standards.