New proposed audit body

Be wary of audit proposals

New corporate audit body would be ‘costly distraction’ and drain on talent, says the ICAEW’s Iain Wright

The Department for Business, Energy and Industrial Strategy (BEIS) consultation on restoring trust in audit and corporate governance, launched by business secretary Kwasi Kwarteng in March, set out to beef up audit and improve company reporting in the aftermath of a string of high-profile company failures, including the collapse of Carillion in 2018.

Among its many proposals was the idea – previously suggested by Sir Donald Brydon – of a separate corporate audit profession which would, among other things, elevate the status of auditors and reinforce their ethical and public interest obligations.

While reform to the sector is key, the future of UK audit is heavily reliant on the next generation of talented accountants coming through the ranks.

We absolutely agree with the Government that reinforcing our competitive advantage in a globalised economy through reinforcing our strengths in corporate governance is key, but that is also true of attracting and nurturing the next generation of auditors and business leaders. The Government is best placed to do this by reinforcing existing strengths, rather than wrecking them. That is very true for any proposals for a standalone profession.

Chartered qualifications originating in the UK, whether they are engineers or accountants, are a symbol of high quality, excellence and integrity. It takes many decades to build up such global reach and reputation. That is why a standalone profession will not achieve what the Government might believe it will; it will be costly and may not prove to be attractive to new talent who want, at the start of their careers, to have a strong qualification that is flexible and renowned enough to take them to a variety of different experiences and employment opportunities.

We are strong advocates for less complexity and red tape, but this proposes the opposite. A new institute for corporate auditors would be costly, with no clear proposal of who would pay. It would be disruptive to set up and would face significant challenges along the way, such as duplicating work in the sector. In turn, this would compromise the competitiveness of the UK and hinder the valuable efforts currently being undertaken to level-up the country and achieve net zero.

Reform is needed, but setting up a new body could take years, maybe even decades, with no guarantee of success. Splitting the audit and accountancy professions has already been trialled in other countries, such as France, where it has failed.

With this in mind, and as a professional body with members around the world and with the scale, resources and the greatest share of the UK PIE and non-PIE audit market, we’d prefer to focus our efforts on creating a home for, and strengthening the identity of, auditors.

This approach could include a disciplined CPD regime and a continuous review of our qualifications and the audit process in general, to ensure auditors are trained and work at the highest level.

Developing and nurturing talent is key to realising the government’s vision of corporate audit and improving audit quality. By working closely with other professional services bodies in the UK, it is vital we continue focusing on attracting high-quality entrants. But in restoring trust to business and providing a strong voice and role for audit, the answer is not to wreck existing strengths and assets.

• Iain Wright, Managing Director, Reputation and Influence, ICAEW

Iain Wright

PQ remote learning

Home comforts for AAT distance learning students

Dozens of distance learning students have already taken advantage of ‘a fantastic opportunity’ to sit their AAT assessments remotely.

Traditionally, all exams have been conducted at AAT Approved Assessment Centres across the UK and some locations overseas.

However, following successful pilot schemes in late 2020 and early 2021, the AAT have introduced remote invigilation for a range of Level 1, 2 and 3 qualifications.

Remote assessments available include all Foundation (Level 2) Accounting units with the exception of the Using Accounting Software module.

Advanced (Level 3) remote assessments are also available, with only the Advanced Synoptic unit exam unavailable.

The move means AAT distance learning students can book their assessments through any provider who offers the new, alternative option – not only their training provider.

Premier Training, who played a key role in the remote assessment trial, is amongst the first providers to offer booking and scheduling for all AAT students.

Rose Crockett, Operations Director at Premier Training, said: “What a fantastic opportunity for AAT students to sit selected assessments from the comfort of their own homes.

“Students with any training provider, and selfstudiers, can book their remote assessments through Premier Training and keep progressing through their AAT qualifications. That’s even greater flexibility from the AAT and Premier Training!”

There are some essential technical requirements that students must meet to sit their AAT assessments via remote invigilation (see below).

As with the assessment centre model, exam costs vary depending on the provider or centre. Premier Training have committed to applying just a £12 fee onto the cost of the AAT assessment fee for the booking and scheduling of each exam.

For more information on the assessments available, the technical requirements and how to book your assessment with Premier Training go to https://tinyurl.com/y5j5kxv2

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