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Audit & Beyond

Stay positive under pressure

Author: ICAEW

Published: 17 Nov 2023

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Planning and preparation are key when it comes to surviving any audit busy season.

Complex regulations, difficult clients, tight budgets and deadlines, time-consuming preparations and the prospect of long working hours. These are just a few of the matters that can loom large as accountancy and audit firms head into what will, for many, be their busiest time of the year. For auditors, there will be practical, technical and ethical challenges and more personal stresses and strains ahead. Preparation and planning will be key.

Among the following advice, information and other resources, there should be something useful for all auditors, from the most junior to the most senior team members.

Focus on the personal

Stress-related symptoms can be difficult to identify and manage, but if they are not addressed our mental health can suffer. The Audit and Assurance Faculty and the occupational charity caba offer resources that can support auditors to take actions to help themselves and others in the team.

Explore caba resources for addressing stress and pressure in the workplace.

Audit & Beyond offers pointers on managing stress during the busy season, with tips that can help an audit team, and small changes that each individual can take to boost their wellbeing.

A recorded webinar on maintaining wellbeing during the busy season offers advice and pointers to other resources.

Focus on the practical 

The demands of being in a leadership position, managing resources and communicating with team members, clients and other stakeholders can all be more intense around the busy season. Articles and webinars from the faculty and other parts of ICAEW may assist with some of the practicalities.

Being in a leadership position, managing resources and communicating with team members, clients and other stakeholders can all be more intense around the busy season

The International Standards on Quality Management (ISQM 1 and ISQM 2) have given audit firms an opportunity to strengthen their focus on risks around practical matters such as client acceptance and continuance, engagement performance, governance and leadership, information and communication, and the management of resources and use of service providers. 

Quality management in audit firms is a hub offering guidance and practical resources. The Audit & Beyond article ISQM 1: maximising the benefits shares insights into the practical challenges of implementation and offers practical solutions. This is also the theme of a live faculty event ISQM 1 – maintaining momentum from 9-12 AM GMT on 21 November at Chartered Accountants’ Hall. 

The Audit & Beyond article What makes a good audit manager highlights elements that are key to balancing the technical and non-technical demands of this role, with pointers to related resources, including an on-demand webinar.

How to improve audits with project management offers tips on getting the most from various approaches, frameworks, and tools – and highlights why this is so important. Audit project management software considers tech-enabled tools and services for automating aspects of audit project management.

Ethical issues can be more challenging and complex for auditors than for other accountants because, in addition to being mindful of the ICAEW Code of Ethics, auditors must understand and apply standards such as the Financial Reporting Council (FRC) Ethical Standard for Auditors (see Focus on Standards, below). 

Ethical issues can be more challenging and complex for auditors than for other accountants

In some scenarios it may be helpful to consider ethics-related issues with the assistance of ICAEW’s Framework for resolving ethical problems; ICAEW members can also access a helpsheet with a decision tree.

Ethics-related articles, guidance, podcasts, webinars and other material can be found at ICAEW’s ethics resource hub.

The ICAEW Insights hub Recentering ethics offers articles and other resources from ICAEW on aspects ranging across culture, leadership and language, and maintaining professional competency. 

Focus on standards

Some of the standards for financial reporting and narrative reporting and for auditing may loom larger than others during the coming busy season. The following links provide access to a host of topical standard-related resources that auditors may find useful.

Although ISQM 1 and ISQM 2 became effective on 15 December 2022, some auditors may feel their impact more during the busy season in 2024 than they did in 2023, as their firm’s systems of quality management will likely have evolved in response to monitoring, root cause analysis, and remediation activities during the past year. ‘Focus on the practical’ above offers pointers to useful resources, including a live faculty event.

There have been major changes to the revised ISA 315 over recent years. Audit & Beyond articles are available on: key elements to consider for December 2023 year ends, including information technology (IT), inherent risk factors, the spectrum of inherent risk and the stand back requirement; and the entity’s IT systems and related risks. There is a recorded webinar offering practical insights on the auditor’s evaluation of controls, IT, and general IT controls, with a follow-up webinar on 6 December from 10-11.30 GMT, so book your place.

Changes in the revised fraud standard, ISA (UK) 240, will also be front of mind for many auditors. A faculty webinar on this revised ISA covers fraud risk assessment, risk factors and indicators, discussing fraud at the engagement team meeting, and the auditor’s response to fraud risks. An Audit & Beyond Question Corner from 2022 offers some pointers; likewise, an article on testing journals, and a faculty webinar on the evolving role of forensic accountants in audits

Given the significance of changes in the revised ISA 540, the prevalence of accounting estimates in financial statements, and the challenging economic conditions, all auditors may welcome a reminder of key requirements in the revised ISA 540. In 2022, the faculty created a specialist hub of resources for auditing accounting estimates. This includes articles, helpsheets, webinars and more on matters ranging from how to spot an accounting estimate to how to document the audit of accounting estimates under ISA 540.

Lack of knowledge of auditing standards and financial reporting standards is a perennial problem, according to root cause analysis (RCA) of negative findings during audit quality monitoring (although a list of what’s behind many common failings also includes flawed design of audit tests and lack of review by senior members of audit engagement teams). So, as well as keeping up to date on ISAs and ISAs UK, auditors need to keep their knowledge up to date on national and international standards for financial reporting and related requirements.

Lack of knowledge of auditing standards and financial reporting standards is a perennial problem

Corporate Reporting Faculty resources can prove invaluable. They encompass material on international and UK standards for financial reporting and non-financial reporting, offering guidance and technical releases, helpsheets and webinars. There are also factsheets that include, for example, guidance on 2023 UK GAAP accounts, 2023 IFRS accounts, the strategic report and directors’ report, the UK Climate-related Financial Disclosure Regulations 2022 and other recent and emerging developments.