ETHICS – Rotten to the core?
Have you wondered why the auditing profession is in such a sad state? Maybe we should start with some serious introspection and fundamental changes.
Not only the IRBA Public Inspections Report 2017, but also multiple auditing scandals in the media showed that independence was the root cause of most audit deficiencies recently. Firm culture needs to be revamped drastically to start changing this around.
Leadership must set a good example and communicate principles of quality and ethics to enable staff to function optimally.
- Build high performance teams through trust, integrity and honesty
- Appoint qualified and experienced staff with a healthy respect for ethics and compliance
- Think of ethics, quality and reputational risk with client acceptance and continuance instead of just seeing money coming into the bank.
- Ethics shouldn’t be something that is avoided as far as possible or just complied with. To make a real difference, push the boundaries and aim for a standard higher than the norm.
- When performing engagements, constantly consider ethics, quality and other professional requirements. Patch jobs after the fact doesn’t work, it ruins the profession.
- Lastly, get into the good habit of thorough self-regulation: continuous monitoring, root cause analysis and remediation will go a long way to setting things right.
International and local standard setters are currently working tirelessly to revamp the codes of professional conduct and quality standards to create this required mind shift in the profession. The exposure drafts are already out or in the making. But it’s up to you to be the change – don’t wait for the new standards to come out, start reviewing the exposure drafts now already and revamp your internal processes. Don’t let quality and ethics manage you, but rather proactively manage your quality and ethics!
If you need advice, guidance, assistance or training, our experienced specialists at LEAF are ready to help your firm to push above and beyond the norm.
Driving the standard of excellence