Incorporating NQ magazine
July 2022
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LATEST AUDIT REFORMS A MISSED OPPORTUNITY
T
he UK’s government is claiming its revamp of corporate reporting and audit regime is going to help restore trust in big business. The dominance of the Big 4 audit firms is being tackled, it said, along with the creation of a new regulator “to reduce the risk of sudden big company collapses, safeguard jobs and reinforce the UK’s reputation as a world-leading destination for investment”. But there is a problem - not everyone is convinced this will actually happen! And it’s not just the usual critics who think this. Lord Sikka told PQ magazine that the reforms will do nothing to improve the audit regime. Where, he asked, were the reforms of audit independence, liability and public accountability? Lord Sikka said: “The government has missed an opportunity to restore confidence in audits and corporate governance.”
He was joined by an unlikely ally, ICAEW CEO Michael Izza, who claimed the government’s approach has been “half-hearted and lop-sided”. Izza is really worried that the lessons from Carillon and other recent company failures have been ignored. He
even suggested that ministers were wrong to believe what they have served up will help to restore public trust in big business. Another critic, Professor Richard Murphy, said the government is clearly not willing to embrace the idea that market failure is possible.
He is concerned that auditing has been left to reform itself, and this means the government has copped out, he said. A real worry will be the fact that even the Financial Reporting Council (FRC) is not enamoured by this once-in-a-generation reform. OK, it likes the creation of the Audit, Reporting and Governance Authority (ARGA), but said: “The Government’s decision not to pursue the introduction of a version of the Sarbanes-Oxley reporting regime is, the FRC believes, a missed opportunity, to improve internal controls in a proportionate, UK-specific manner.” The ACCA sees this as a major omission too, saying companies and company directors need to report on the internal controls over financial reporting. • Check out more about the changes on page 18 and 19 of this issue.
Your ACCA June exam feedback W ho are the ACCA TX examiners, asked one sitter after the June exam. They felt they were “either a super smart person or someone with a twisted sick mind. I am so angry!” Many PQs found the exam ‘difficult’ and ‘hard’, but what really annoyed them was the questions were nothing like the mocks. This really gets a student’s goat big time!
Many sitters also struggled with the SBL sitting. They found the questions poorly worded and just ‘too vague’. One sitter said: “I thought it was bad, nothing like the mock exams.” Many struggled to use to the exhibits, too. Technical issues with remote exams are still causing problems for many. One SBL PQ said their system froze four times, and “after the
last one it did not allow me to join”. Another said their screen froze in the last 15 minutes and they were not allowed to write anything else. For one PQ their OnVue shut down 30 minutes before the end of the exam, and PQ magazine has heard of frozen screens for AAA sitters, too. • See page 26 for all the feedback.
