In the context of the upcoming government consultation into the Brydon Review, we hear a range of ideas when it comes to the future of audit: recommendations around regulation, markets and standards. It’s all very important, but it has always left niggling questions in my mind: how do we, as a profession, develop ourselves? How do we build a modern audit profession?
That is what I aimed to answer as I started work on the ICAEW Audit Manifesto. I wanted to emphasise a different approach for a change within; to be aspirational, to leave our comfort zone and to move beyond conventional approaches, conceptions and views. Our Manifesto proposes five guiding principles that would offer a framework to give professionals the agency to make changes themselves. Auditors need to think about the type of society they want to be part of and consider the wider role and purpose of their profession in serving the public interest.
This is essential if we are ever going to make progress when it comes to audit reform. Government reports on audit failures may offer up some interesting ideas, but they are not necessarily new. It has to go beyond conversation if audit is to adapt with the times.
Young people are looking for a greater sense of purpose when it comes to the careers that they choose, and the audit profession is well-placed to offer that. If we want to redesign the audit profession so that it brings out the best in its people, we need to be self-critical and question our values and assumptions. We must double down on our roles as arbiters of trust and honesty in business, and the positive impacts that can have on the economy and society in general.
We also have new tools at our disposal that allows us to be more valuable to our clients and stakeholders on a more ongoing basis. We can provide oversight throughout the financial year in a way that allows businesses to spot issues before they become too great, from fraud and business risks to societal and economic implications of pandemics.
Now is the time to ask ourselves: what are our ambitions and aspirations as a profession? What role can audit take in shaping the society that we want to create? It’s why we talk about the need for a different mindset in the Audit Manifesto. We have to think like architects and designers to respond to the real needs of our stakeholders, how these needs are changing, and how we should respond.
The profession should lead the conversation about how audit needs to change. Politicians, regulators and standards setters have a different agenda when they look at how to change audit than that of the profession. We know better than anyone what we are getting right and what we could add on and improve. But to do that effectively, we must shift our perspectives and try new methodologies to get where we need to be.
By taking control of the narrative and demonstrating our willingness to change, we can start to build more trust, which we need if we are to do our work effectively. In the modern economy, this means showing our humanity and vulnerability. Wider society needs to get to know auditors as human beings, and we need to talk about issues around honesty and trust and our role in business on a human level.
The Manifesto outlines five principles necessary for the profession to drive change: Purpose, Identity, Community, Education and Mindset. It is a call to action for professionals to explore and develop these areas to create a valued, modern audit profession; a blueprint of what we need to do to take ownership of the debate around the future of audit.
Beyond that, it is about positivity. We need to take an optimistic approach to audit’s future, not drown in criticism. The UK has a strong track record when it comes to audit quality. We should build on that foundation and take it further, demonstrating a path towards a sustainable future for the audit profession.
Further reading:
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