The Auditing Practices Board (APB) recently published stakeholder feedback following its consultation in October last year on whether there should be a prohibition on auditors providing non-audit services to the entities that they audit. In parallel the FRC is publishing for consultation updated guidance to audit committees on determining whether a company’s auditor should be permitted to provide particular non-audit services.
The APB’s October consultation followed a report last year by the House of Commons Treasury Committee which proposed a ban on the auditor providing non-audit services. The consultation generated a substantial number of responses from all APB’s stakeholder groups, in particular, including the views of a range of investors.
The overwhelming view of respondents (irrespective of the constituency involved) is that there should be no outright prohibition on non-audit services.
There is agreement, however, that auditor objectivity and independence is perceived to be adversely affected by the provision of non-audit services and that improved transparency and governance would address these concerns.
Comments on the consulation are requested by 23 October 2010.
For more information and to download the documents, please click here.