The Board of the International Organization of Securities Commissions (IOSCO) is requesting feedback on its proposed good practices for audit committees to support audit quality.
IOSCO published today its Consultation Report on Good Practices for Audit Committees in Supporting Audit Quality, which is intended to assist audit committees of issuers of listed securities in promoting and supporting audit quality. Findings of reviews by audit regulators indicate a need to improve audit quality and consistency of audit execution.
While the auditor is primarily responsible for achieving this objective, IOSCO believes that effective audit committees also can contribute to supporting audit quality and increasing market confidence in the quality of information in financial reports. IOSCO considers the accuracy, integrity, and comparability of issuer disclosure to be essential for maintaining investor and market confidence.
Today´s consultation report proposes good practices regarding the features that an audit committee should have to be more effective in its role, including delineating the qualifications and experience that audit committee members should possess. The report also proposes good practices that audit committees may consider when:
- recommending the appointment of an auditor to members/shareholders;
- assessing potential and continuing auditors;
- assessing the audit fees;
- facilitating the audit process;
- communicating with the auditor;
- assessing auditor independence; and
- assessing audit quality.
The report seeks feedback on the proposed good practices and the role of audit committees and audit quality.
Comments should be submitted on or before 24 July 2018.
