Accountants' body welcomes audit revamp
NEW audit requirements for state and public companies should make the process more transparent but will be an extra burden for auditors, according to the country's main representative body for accountants.
The new requirements have been published by the Financial Reporting Council, which sets auditing standards in Ireland and the UK.
They affect companies who apply the UK Corporate Governance Code.
In Ireland this includes listed companies and a number of state bodies who apply the code voluntarily.
Auditors must now publish an overview of each audit and how risks were addressed, as well as a description of how the risk impacted the audit strategy and allocation of resources.
Chartered Accountants Ireland (CAI), the country's largest and longest professional body of accountants founded in 1888, said yesterday that these changes were welcome.
"This is a significant move away from the previous binary, 'pass or fail', approach of existing requirements which has come under renewed scrutiny in the wake of the financial crisis," said CAI technical policy director Aidan Lambe.
"The Financial Reporting Council has made a number of amendments which will help to reduce the potential for misunderstanding of auditors' reports, which is welcome.
"Nevertheless, we continue to see the changes as challenging.
"Audit firms impacted by these proposals and relevant clients must now prepare for their application in respect of reporting periods commencing on or after October 1 2012."