CIIA pens letter to PM urging audit reform

The Chartered Institute of Internal Auditors (CIIA) has penned a letter to the prime minister to highlight the concerns regarding the pace of audit reform.

In the letter, John Wood, the chief executive of the CIIA, has called for the inclusion of an ‘Audit Reform Bill’ in the next Queen’s Speech and added it is “essential that time is found to pass legislation in the next parliamentary session”.

It comes as this week marks the one year anniversary of the Government publishing its White Paper ‘Restoring Trust in Audit and Corporate Governance’.

However, the Department for Business, Energy and Industrial Strategy is yet to publish its response to the public consultation it ran last year, and set out a clear timetable for the proposals in the White Paper to be implemented, including those that require legislation.

Wood said in the letter: “While we fully understand and appreciate that the Government has been grappling with a myriad of critical issues, including the coronavirus crisis, the energy crisis, and now the war in Ukraine, the issue of audit reform does not sit in a silo.

“Indeed, we would argue that because of these crises it makes audit and corporate governance reform even more vital to supporting the long-term success of businesses and the wider economy. Helping to protect jobs, pensions, and livelihoods.”

He added: “With the UK now facing further significant economic uncertainty, with the consequences of the Russian invasion of Ukraine impacting growth, inflation, and interest rates, this in turn means that businesses are now faced with an adverse business risk environment that we have not seen for decades.

“Now more than ever, businesses and investors need high quality and effective audit, stronger internal financial controls, and an audit regulator with the teeth it needs to do its job properly. A more robust audit and corporate governance framework will support boards to identify, manage, and mitigate the risks they face successfully.”