FSB published a summary of topics discussed at the External Audit Roundtable, which was held in Toronto on June 06–07 and was hosted by OSFI, Canada. The objective of the Roundtable was to engage in constructive dialog on ways to promote international financial stability by enhancing public confidence in auditors and the quality of audits, especially for systemically important financial institutions.
Roundtable participants comprised senior representatives from FSB members, including national prudential authorities, market regulators and audit oversight bodies, the International Forum of Independent Audit Regulators (IFIAR), the international auditing standard-setter, and the six largest global audit networks. In the context of the objective of the Roundtable, the following areas were considered:
- The recurrence, level, and root causes of audit inspection findings identified by IFIAR members in their individual inspections of audit firms affiliated with the global networks
- Observations from initial audits of expected credit loss estimates under IFRS 9, including the audit work needed to assess the related governance and controls, management judgments and assumptions, and the resulting presentation and disclosures
- The global networks’ progress in preparing for the implementation of IFRS 17 and the related audits
- Support for IFIAR in promoting collaboration in regulatory activity to foster the effectiveness of audit oversight globally
- Effective avenues to strengthen the dialog between the official sector and the global networks, as a means to inform strong financial-sector policies to advance audit quality and promote international financial stability
- Characteristics of audit services, particularly for financial statement audits of systemically important financial institutions, and the potential implications for the role of financial reporting in international financial stability
- The importance of a robust and proactive approach by the global networks in continuing to improve audit quality
Related Link: Press Release
Keywords: International, Accounting, Banking, Insurance, Systemic Risk, SIFI, IFRS 9, IFRS 17, External Audit, Financial Stability, FSB
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