The future of audit
The report 'Auditor skills in a changing business world' by ICAS and the UK Financial Reporting Council (FRC) explores the vision of the auditor of the future.
The report was produced by a high profile Steering Committee and builds on the independent academic research published by ICAS and the FRC earlier this year.
The report calls for a debate on the future of audit and the skills needed to meet that vision. If audit is to evolve beyond the traditional financial statement audit, then the skill set of auditors needs to evolve to execute the audit of the future.
There is a risk that the audit profession could fail to attract and retain the best talent and be unable to deliver the requisite skills and meet the demands of complex company audit. The Steering Committee therefore calls for action from the firms, professional bodies, regulators and standard setters, and investors.
The report focuses on three main areas that need to be developed to equip the audit team of the future to undertake an audit that is more holistic and useful for shareholders and society. These are categorised as:
- Advanced business acumen skills.
- Technology and data interrogation skills.
- Soft skills.
The report also highlights the following barriers or impediments to change which need to be overcome for this vision to be realised:
- The problems of recruiting and developing audit team members.
- The extent to which standardisation may impair the development of judgement and innovation.
- The perception of audit as a career of choice.