Mixed reaction to forced rotation of audit firms
The industry regulator plans to force companies to hire new audit firms on a regular basis to enhance independence and promote transformation
AUDITING firms have expressed mixed feelings following the announcement that the industry regulator plans to force companies to hire new audit firms on a regular basis to enhance independence and promote transformation.The Independent Regulatory Board for Auditors (IRBA) believes mandatory audit firm rotation will strengthen audit firm independence and contribute to investor protection. "Somehow, we have got to force a break in the relationship between auditors and their clients," said IRBA CEO Bernard Agulhas, noting that sometimes these relationships spanned more than 40 years.The IRBA’s latest statutory inspections had alerted the board to possible independence issues, Agulhas said.Geoff Pinnock, managing partner: Africa assurance at Deloitte, said a company’s own audit committee was best placed to assess the independence of the external auditor. In terms of current regulations in SA, audit partners — the individuals who personally sign off on financial statements — had to change...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.