Big changes are supposed to be coming to the world of auditing.
If it feels like you’ve heard this before, that’s because you have.
A lot.
These changes are stuck in an implementation purgatory and may never see the light of day.
However, the intent to reform is clear, and so auditors wishing to get ahead of any proposed changes need to be ready to update their processes when the time comes.
What are the proposed changes to auditing?
The big change centres around the regulatory system that sets the standards and monitors compliance for audits.
The Financial Reporting Council (FRC) is going to be replaced by the Audit, Reporting, and Governance Authority (ARGA).
When this was announced, some in the sector were cautiously optimistic about the change, believing that it could signal a positive move for auditors looking for better regulation and support.
ARGA is supposed to come with a host of new powers designed to make auditing a more effective process for auditors and businesses alike.
Unfortunately, the lack of a clear implementation deadline is causing some doubt to creep in about the effectiveness of the proposal.
ARGA has been delayed numerous times, and the exact date of its enforcement is yet to materialise.
With every delay that happens, ARGA seems more and more like a fairytale told to baby auditors to help them sleep at night.
While ARGA may never come, there are other reforms lined up that could be implemented before the heat death of the universe.
A statutory separation of audit and non-audit services for larger audit firms is being proposed as a way to guarantee full transparency in all financial dealings.
This could be paired with a mandatory audit firm rotation.
This was something outlined in a Government whitepaper and would see mandatory tendering or rotation of auditors every ten years to ensure that businesses are treated with fresh scrutiny.
Alongside this, a shift in compliance responsibility to directors might see standards improve as the threat of tougher sanctions for failing to cooperate fully with audits will make them more proactive.
Frustratingly, none of these measures has a date of implementation nor any assurance that they will come to pass.
We can all sit and dream of how things might change in the future, but it leaves auditors in an uncomfortable position of uncertainty.
What can be done to change auditing while official reforms are delayed?
You do not want to just sit around and wait for things to change when you could be making a positive impact on the sector.
Being proactive about streamlining auditing processes now will mean that you are ready for any tightening of guidelines.
Glasscubes is an effective tool for perfecting your auditing process.
Rather than waiting for the threat of penalties to get directors to give you information, Glasscubes’s automated reminders can do all the reminders for you.
The streamlined system collates all the information needed for a successful audit in one location, and we will be sure to update the system to keep pace with any changes in guidelines.
If ARGA ever comes, or if any of the other reforms get implemented, you can be safe in the knowledge that your systems are dynamic enough to handle all changes.
It is worth being ARGA-ready, even if you never actually have to be.
Relax about the future and streamline your auditing process now. Book a demo today!
