The overall results of the FRC’s reviews of the Mazars’audits show worse results than the previous year, with two out of five assessed as requiring more than limited improvements, compared with one of five in 2017/18.
The FRC also noted that it had assessed three audits as requiring significant improvements over its last four inspection cycles. Across all the reviews, there are a number of findings that the firm needs to address, the FRC said, some of which are similar to findings from its previous inspection.
Mazars has made progress this year in addressing prior year firm-wide findings on recording and monitoring partner financial interests and including specific performance objectives for audit quality in partner and staff appraisals. However, the FRC said improvements continue to be required to the recording and monitoring of staff financial interests.
Key individual review findings related principally to the need to:
- Improve consultation and monitoring processes for non-audit services.
- Improve the testing of controls including IT general controls.
- Strengthen the testing of revenue for complex revenue streams and improve substantive analytical review procedures.
- Improve the evidence of appropriate challenge in areas of judgement.
The firm-wide issues identified concerned:
- Continuing to improve systems and procedures to ensure compliance with the revised Ethical Standard.