Publicising the discussions between auditors
and banks could increase the value placed on audit and strengthen
market confidence, according to a report from the Institute of
Chartered Accountants in England and Wales (ICAEW).
The ICAEW report, Audit of banks: lessons
from the crisis, also calls for banks to improve the way they
present risk information, and auditors and bank supervisors to
improve the way they interact.
Speaking on the release of the report, ICAEW
financial services faculty head Iain Coke said bank auditors need
to do more to explain the value of audits to outsiders.
The ICAEW report contains a number of
commitments from the institute, including:
- Developing good practice guidance for bank auditors reporting
to audit committees; and,
- Setting up an investor-auditor forum to highlight themes that
auditors will be paying particular attention to across the banking
sector in a reporting season.
The ICAEW report is based on six months of
research, which included interviews with senior stakeholders from
banks, investors and policymakers.
It responds to questions that have arisen
during the financial crisis about the value of bank audits.
A European Commission paper on corporate
governance in financial institutions released earlier this month
questioned the scope of auditor responsibilities.