IAASB Proposes New Framework for Enhancing Audit Quality

The International Auditing and Assurance Standards Board has released for public comment a new consultation paper aimed at improving the quality of audits.

In issuing the document, entitled "A Framework for Audit Quality," the IAASB, which operates under the auspices of the International Federation of Accountants, is asking for input from who have an interest in continually enhancing audit quality, including regulators, audit committees, investors and audit firms.

Through the proposed framework, the IAASB hopes to raise awareness of the key elements of audit quality, encourage stakeholders to explore ways to improve audit quality, and facilitate greater dialogue between key stakeholders on the topic.

“While the IAASB recognizes that high-quality auditing standards and well-qualified, competent, skeptical auditors are essential to a quality audit, there are many factors that contribute to maximizing the likelihood of quality audits being consistently performed,” said IAASB chairman Arnold Schilder in a statement. “There is value in identifying and describing these factors and, thereby, encouraging audit firms and other stakeholders to challenge themselves to think about whether there is more they can do to increase audit quality in their particular environments.”

The IAASB said it is seeking responses to several questions listed in the consultation paper, particularly whether the framework is clear, comprehensive, and useful. In developing the framework, the IAASB has also identified, with the input of stakeholders, a number of areas for consideration by both auditors and other participants in the financial reporting supply chain that may benefit audit quality on a global basis.

“The proposed framework describes the input and output factors that contribute to audit quality at the engagement, audit firm, and national levels. It also demonstrates the importance of appropriate interactions among stakeholders and the relevance of various contextual factors,” said IAASB technical director James Gunn. “We hope that A Framework for Audit Quality will generate discussion and that its active use by various stakeholders will result in positive actions in the public interest to achieve a continual improvement to audit quality.”

To access the document or submit a comment, visit the IAASB’s Web site at www.iaasb.org. The IAASB is asking for comments to be submitted by May 15, 2013.