With every corporate failure, from BHS to Carillion to Patisserie Valerie, the pitch of the cries for change in the regulation of the audit market gets shriller.
Earlier this month, Rachel Reeves MP, Chair of the Business, Energy and Industrial Strategy (BEIS) Committee, officially launched the Committee's new inquiry examining the future of audit. Describing the audit market as "broken", Reeves placed misleading audit "at the heart of corporate failures over recent decades." Accounts she claims show "a closer resemblance to works of fiction than an accurate reflection of the true financial performance of the business" have significantly undermined public and investor confidence.
So, we now have three investigations going on:
- The Competition and Markets Authority (CMA) is investigating whether the sector is competitive and resilient enough to maintain high quality standards
- The Kingman Report is an independent review of the financial reporting Council, the regulator for auditors, accountants and actuaries. It aims to make the FRC the best in class for corporate governance and transparency.
- And now the BEIS inquiry, examining the future of audit.
If you want to have your say, the BEIS inquiry is asking for written submissions by 11th January 2019.