The Institute of Chartered Accountants in
England and Wales (ICAEW) has called for more information on the
challenges and debate that takes place between bank auditors, the
audit committee and executive management
In its report, Enhancing the dialogue
between bank auditors and audit committees, the ICAEW
recommends details of key accounting judgments that have been
challenged by the audit committee to be published in banks’ annual
reports expanding on the information currently provided to
stakeholders.
The ICAEW said much of the bank audit process
takes place behind closed doors and the lack of transparency has
led to questions being raised over the extent of professional
scepticism being applied.
ICAEW Financial Services Faculty head Iain
Coke said public confidence had been “damaged” and needed to be
re-built, and clear reporting, robust auditing and transparent
governance processes are critical elements in making that
happen.
“Regulation must be complemented by competence
and appropriate behaviour to produce effective governance,” Coke
explained.
“Auditors must tell a full, clear story of the
audit to audit committees, while audit committees, in turn, must
tell their own story to the public to provide confidence in the
governance process.”
The ICAEW wrote the report on the basis of a
working group consisting of audit partners, audit committee chairs
and other experts with big complex banks in mind.
