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A big four firm has announced the establishment of an external audit quality advisory board as it looks to address concerns over audit quality.
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Big four firm establishes external audit advisory board
17 December 2019
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PwC has welcomed three members to its newly established external audit quality advisory board, who have been tasked with providing advice, guidance and challenge around audit quality at the firm.
The three members include former Auditor-General for Australia Ian McPhee; Professor Margaret Abernethy, the current Sir Douglas Copland Chair of Commerce at the University of Melbourne; and Damien Johnston, former Tabcorp chief financial officer.
According to the big four firm, the three members were selected for their significant experience in the audit sector.
“We are proud to welcome three leading accounting experts as the inaugural members of our newly established audit quality advisory board which will provide an extra layer of external scrutiny over audit quality,” said PwC Australia Assurance managing partner Matt Graham.
“The board will have access to all information about the firm’s audit quality processes, report their views and recommendations publicly as part of our annual audit quality transparency report and provide input to the remuneration of audit partners as it relates to audit quality.”
Mr McPhee, who had chaired the review into CPA’s governance regime, will chair PwC’s external audit quality advisory board.
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“Quality audits are critical to a well-functioning and trusted financial system, and we are looking forward to working with PwC as it takes steps to further strengthen audit quality,” Mr McPhee said.
“By providing the firm with external and diverse perspectives, we hope to provide both counsel and challenge about how quality can continue to improve and help build trust in the audit more broadly.”
PwC’s announcement follows ASIC’s recent release of its latest audit inspection results.
The corporate regulator found adverse findings in 26 per cent of audit files reviewed across firms of all sizes in the 12 months to 30 June 2019, with PwC’s result at 18 per cent, up from 12 per cent in the previous inspection period.
“We’re acutely aware of the critical role that transparency plays in accountability and building trust, and the establishment of this advisory board is a further step forward in being more transparent as we open ourselves up to external perspectives and share these views publicly,” Mr Graham said.
“More broadly, we are continuing to challenge ourselves on the future path of our business and listen to changing community expectations to ensure our industry thrives and trust in the audit profession is maintained.
“I am incredibly proud of the work our firm undertakes every day in our audit business and across the whole firm, and we look forward to continuing an open dialogue with our clients on their changing needs as well as actively engaging with our regulators and government.”
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