Audit News - Issue 69 November 2021

The Charity Commission for England and Wales wants to see ICAEW audit firms do better at meeting their duty to report matters of material significance including modified audit opinions for charities. In this article, we look at why these reports are so important and what firms should be doing to improve their reporting.

We have also produced guidance for auditors and independent examiners on their duty to report any matters of material significance to UK charity regulators. The guidance sets out what should be considered a matter of material significance and the expectations of UK charity regulators. It includes a recording from Nigel Davies, Assistant Director of Accountancy Services at the Charity Commission for England and Wales.

ICAEW’s Quality Assurance Team have provided an update following their return to onsite reviews, as well as the shadowing of these visits by the Professional Oversight Team from the Financial Reporting Council (FRC). The FRC has also provided a reminder to audit firms that they are entitled to ask for any information or access any information if it is considered necessary for inspecting or investigating statutory audit work even though the audit monitoring work is carried out by ICAEW.

Firms and IPs are asked to complete an anonymous survey after each monitoring review. They are asked to provide feedback on the review process, the quality of interaction and the support provided. Please ensure you complete the feedback survey as it helps to support the continuous improvement of our monitoring processes and procedures. View the latest feedback results for Q3.

An update on matters for ICAEW audit-regulated firms including audit work in Ireland, revised ISAs and new resources. You can discover further insights from our audit monitoring activities.

The audit of going concern is often a challenge. Access new ICAEW guidance on what a good audit file looks like in the context of going concern. This will help firms and members understand how to conduct and document audits in a way that stands up to scrutiny. It includes how to interpret the requirements of ISAs (UK) and how to make well balanced judgements and apply professional scepticism.

The FRC’s recent report, What makes a good audit?, highlights the six key attributes that contribute to the running of high-quality audit practices such as the culture, governance and leadership of the firms, alongside their investment in well qualified people, training and processes. It also includes the key elements that contribute to high quality individual audits from the planning phase, through to the delivery and completion of audits.

Some requirements, rules and regulations apply across the board for all firms. Other depend on the types of work you intend to carry out. So, we have put together a series of articles that offer insights, advice and tips from our Quality Assurance and Regulatory Practice teams to help you navigate the process and avoid common pitfalls.

The ICAEW Regulatory Board submitted an extensive response to the Department for Business, Energy and Industrial Strategy’s (BEIS) White Paper on corporate governance and audit reform. In the response, which is the first time the board has replied in its own right to a government consultation, it debunks some myths about current oversight of the accountancy profession and puts the case for continuing its role within the reformed regulatory infrastructure.

Changes to ICAEW’s minimum approved wording for Professional Indemnity Insurance (PII) have clarified the extent to which policies cover cyber-related claims. What do the changes mean, how are cyber risks evolving and what can you do to ensure your firm has the right protection?