“Shotgun aimed at auditors”, says Brydon

Sir Donald Brydon, who is conducting a landmark review into UK audit, is “troubled” by the current mood towards auditors

The former London Stock Exchange chair and veteran of the City was appointed to lead the review in December. The Brydon Review – the call for views of which closed after generating over 100 responses – is focussed on the scope of audit to ensure it meets the needs of shareholders, other direct stakeholders, and of wider society.

It was one of a number of reviews launched in response to several high-profile company failures in recent years, most notably that of Carillion.

Speaking publicly for the first time since he began the review, Sir Donald said, “It is not auditors that cause companies to fail, that’s the result of the actions of directors.

“I’m a little troubled by the current mood that reaches for a shotgun aimed at auditors every time there’s a corporate problem.

“Audit needs to be an attractive profession that attracts the brightest and the best who can have confidence that a good piece of professional work will not be misdescribed in times of stress”, he said according to a report in the Financial Times.

Sir Donald added he was “seeking for audit to become more informative and not just a compliance-checking function, and one which helps to maintain and grow trust in business as a whole”.

The results of his review are expected by the end of the year.

In December the Competition and Markets Authority proposed a radical shake-up of the UK audit market and the Big Four firms. The reforms include splitting the audit and advisory businesses at big accountancy firms, regulatory scrutiny of auditor appointments and management, and a joint audit regime for FTSE 350 companies.

 

Originally published in Economia on 7 October 2019.