The Australian Securities and Investments Commission (ASIC) has issued a reminder to registered company auditors about their legal, ethical and professional responsibilities.
The regulator took the step against a backdrop of intensified attention on the conduct of individual auditors and the behaviour of audit practices more broadly.
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ASIC said it is concerned about the potential erosion of trust and confidence in the auditing profession and is seeking to reiterate that auditors are required to meet their obligations in full.
Auditor misconduct remains a key enforcement focus for the regulator.
The regulator will open investigations and may pursue enforcement measures where ASIC identifies sufficient grounds for concern, it added. The measures may include seeking the suspension or cancellation of an auditor’s registration, issuing infringement notices or initiating civil proceedings.
The correspondence follows ASIC’s launch of a separate review of the ‘Big Four’ audit companies, focusing on internal complaints made within these companies about their audit practices.
In its letter, ASIC emphasised the essential function auditors perform in underpinning confidence in Australia’s financial markets by helping to ensure that investors, consumers and other users of financial statements can depend on “high-quality” audit work.
The regulator also set out the audit-related activities it is currently undertaking, including continued monitoring of financial reports and audit files.
Earlier this month, ASIC intensified sector scrutiny by launching a review of how Big Four audit practices handle conduct complaints.
