A vision for auditing and an overall better society is being considered by the Institute of Chartered Accountants England & Wales (ICAEW) and the Royal Society of Arts (RSA) and has been given in a joint report for Enlightening Professions. The report aims to change one’s thinking about the way that the audit could succeed.
From the summary of the report, the audit has to assist in building up and maintaining the trust in markets that both society and business need to function well. The main issue in this lies in the fact that trust in the auditors themselves has been damaged. It can also be attributed to the fact that there have been large changes in social attitudes and information technology that makes those using audit reports feel more skeptical. Finally, the actual benefits of an audit are becoming harder to define.
This report asks for an audit to go from a product that produces trust to a practice that does the same thing. The auditor is free to use their position as a trusted intermediary to implement evidence-based learning across all areas of an organization including those who have stakes in the organization in order to show all aspects of its value. This includes areas such as environmental, social and economic.
As it is a service that almost exclusively consists of an external investigation by professionals, contemporary technology will make auditing more and more co-productive. The role the auditor plays will expand to include the help of an expert conveyor that is willing to share their knowledge and tools. The report also states that in the future the auditor will also be a team of multidisciplinary members that work both between and within companies as the marker becomes a more flexible and innovative space.
At the event, the chief executive of ICAEW said that the need for auditors to generate sufficient escape velocity to escape audit requires asking difficult questions in order to properly respond to all of the challenges that stand out when turning an audit into a trust-producing practice.
Among these questions that should be asked, some of the most important are:
- What can my audit and assurance work do in order to cause an impact across the business that I am auditing?
- What are the biggest problems that the customers of my clients are experiencing? How can an audit realistically solve them?
- What innovations in ISAE 3000, AAF 01/06, ISAE 3402 and AAF 02/07 reporting will turn out to be the most useful to the stakeholders?
- How can assurance work alongside compliance teams and internal auditors transform into something that is more co-productive while still keeping up with independent audit rigour?
- What is the best way to use crowd-sourced audit tools in auditing culture in order to transform it into a firm, trust-producing audit practice?
With these questions in mind, you can apply this new line of thinking to the industry itself and escape what is known as “Audit Groundhog Day”. If you have any questions or need more information do not hesitate to contact us.