12/10/2004 - 22:00

Audit surveillance round announced

12/10/2004 - 22:00

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Audit surveillance round announced

The big four accounting firms, selected mid-tier firms and other firms where systemic independence issues arose are to be the targets of the Australian Securities and Investments Commission’s first round of auditor independence surveillance.

The surveillance is to regulate auditors’ compliance with the independence requirements of CLERP 9.

ASIC chief accountant Greg Pound said: "We have chosen audit firms that have a significant number of listed company clients for the first year".

"This will help us form a view about the general level of compliance by auditors of the majority of listed companies," he said.

"In the second year we will expand the program to cover audit firms with a smaller number of listed company clients and over time we will cover all audit firms on a systematic basis."

ASIC may also target any specific independence issues of concern identified in the market.

"Our role is to enforce the legislative requirements designed to prevent potential audit independence issues," Mr Pound said.

"Audit independence requires an auditor be independent in fact and also to be perceived as independent.

"To the extent that readers of a financial report and associated auditor’s report believe there is a lack of audit independence, the usefulness of the audit function in adding credibility to the financial report is impaired."

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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