On 24 July 2018 the AICD provided a submission to IOSCO on the Consultation Paper on Good Practices for Audit Committees in Supporting Audit Quality.
In our submission, we supported the issue of the proposed IOSCO good practice guide for audit committees, with its focus on principles. We consider this guide to be useful in an international context, particularly in jurisdictions that do not have a strong focus on ‘audit quality’. We identified several areas for improvement, as follows:
- Consideration to be given to the good practices areas in Australia in relation to independence of audit committee members and the chair, as well as the skills required for the audit committee chair
- The articulation of the role of the audit committee in assessing and challenging the decisions made by the auditor in undertaking their audit work
- The issues associated with the use of the word ‘ensure’
- The proposed public reporting by the audit committee, given the board has responsibility for reporting to shareholders and not the audit committee.
The AICD also highlighted the existing booklet, Audit Committees – A Guide to Good Practice (Third Edition) a joint publication by the AICD, the Auditing and Assurance Standards Board and the Institute of Internal Auditors, as providing a practical introduction to the role and responsibilities of audit committees in Australia.
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