PwC UK is introducing measures to ensure it delivers “consistently high quality audits” in the form of a £30m investment and the recruitment of 500 experienced auditors.
This is part of the firm’s plan to provide greater focus on the quality and public interest responsibilities of its statutory audit services.
The plan has three key areas: additional investment in training, people and technology; further alignment of PwC’s audit business behind audit quality; and a reinforced focus on culture and quality control.
However, its plan did not make mention of the splitting of its audit and consulting services, as recommended by the CMA following its inquiry into the audit sector.
Hemione Hudson, head of audit at PwC UK, said: “Over the last year, we have been listening to the views of a wide range of stakeholders about the future of audit – exploring how it needs to change to meet society’s evolving expectations. Given the important role that auditing plays in the modern economy, everyone that relies on audit work needs to have the same high level of confidence in its transparency, objectivity and effectiveness.
“Today’s announcement is a demonstration of our commitment to audit and to continually improving and strengthening audit quality. We have said for some time that we support changes that will improve audit quality. The investments and changes we are putting in place will ensure that our people have the skills, knowledge and mindset to perform audits to a consistently high quality day-in, day-out.”
The key actions announced include:
- Committing an additional £30m annually – targeted at training, people and technology initiatives
- Doubling the face-to-face training programme for all our experienced auditors
- Creating a new national digital audit team – focused on the development and application of innovative technologies that will help drive audit quality.
- Hiring more than 500 additional experienced auditors across the UK
- Commissioning an independent paper from Karthik Ramanna, professor of business and public policy at the University of Oxford’s Blavatnik School of Government, on what a culture of challenge means for auditors in 2019
- Creating a practice with a singular focus on external audit and strengthening its governance with our independent non-executives
- Undertaking a comprehensive review of the entities that we audit to ensure we achieve a return that allows continual investment in and focus on quality.
- Increasing by two thirds the number of specialists in our audit quality control team
Hudson added: “It is right to continually review how our audit practice operates to ensure we are focused on conducting the most challenging and objective audits. These actions will ensure more consistent audit quality and increased transparency while at the same time strengthening our market resilience.”