The Financial Services Authority (FSA) and the
Financial Reporting Council (FRC) have expanded the information
they can exchange to improve audit oversight.
In a new agreement, which follows the
publication of a joint discussion paper on the audit of financial
institutions published in June 2010, there will be a closer working
relationship between the FSA and the FRC’s Audit Inspection
Unit.
This collaboration is designed to help both
bodies address concerns raised about the audit of banks during the
financial crisis.
PwC said it supports the FSA and FRC’s
new agreement as it underlines the importance of regulators
cooperating both domestically and across borders.
However, in backing the agreement, PwC repeated its challenge
to the FSA’s suggestion that the accounting profession was not
showing enough ‘scepticism’ when signing off accounts.
“When it comes to professional scepticism, the FSA’s
perspective appears to be different to the auditing profession’s,”
PwC’s head of public policy and regulatory affairs Pauline Wallace
said.
“We view our role as one of ensuring management has
appropriate robust evidence to support its assumptions – It is not
for us to present an alternative view and try to get management to
accept it as better than theirs,” Wallace added.
PwC said it remains committed to cooperation with the
regulators to guarantee audit quality in the UK remains at a high
level, while striving for continuous improvement.
