ICAS ICAS logo

Quicklinks

  1. About Us

    Find out about who we are and what we do here at ICAS.

  2. Find a CA

    Search our directory of individual CAs and Member organisations by name, location and professional criteria.

  3. CA Magazine

    View the latest issues of the dedicated magazine for ICAS Chartered Accountants.

  4. Contact Us

    Get in touch with ICAS by phone, email or post, with dedicated contacts for Members, Students and firms.

Login
  • Annual renewal
  • About us
  • Contact us
  • Find a CA
  1. About us
    1. Governance
  2. Members
    1. Become a member
    2. Newly qualified
    3. Manage my membership
    4. Benefits of membership
    5. Careers support
    6. Mentoring
    7. CA Wellbeing
    8. More for Members
    9. Area networks
    10. International communities
    11. Get involved
    12. Top Young CAs
    13. Career breaks
    14. ICAS podcast
    15. Newly admitted members 2022
    16. Newly admitted members 2023
  3. CA Students
    1. Student information
    2. Student resources
    3. Learning requirements
    4. Learning updates
    5. Learning blog
    6. Totum Pro | Student discount card
    7. CA Student wellbeing
  4. Become a CA
    1. How to become a CA
    2. Routes to becoming a CA
    3. CA Stories
    4. Find a training agreement
    5. Why become a CA
    6. Qualification information
    7. University exemptions
  5. Employers
    1. Become an Authorised Training Office
    2. Resources for Authorised Training Offices
    3. Professional entry
    4. Apprenticeships
  6. Find a CA
  7. ICAS events
    1. CA Summit
  8. CA magazine
  9. Insight
    1. Finance + Trust
    2. Finance + Technology
    3. Finance + EDI
    4. Finance + Mental Fitness
    5. Finance + Leadership
    6. Finance + Sustainability
  10. Professional resources
    1. Anti-money laundering
    2. Audit and assurance
    3. Brexit
    4. Business and governance
    5. Charities
    6. Coronavirus
    7. Corporate and financial reporting
    8. Cyber security
    9. Ethics
    10. Insolvency
    11. ICAS Research
    12. Pensions
    13. Practice
    14. Public sector
    15. Sustainability
    16. Tax
  11. CPD - professional development
    1. CPD courses and qualifications
    2. CPD news and updates
    3. CPD support and advice
  12. Regulation
    1. Complaints and sanctions
    2. Regulatory authorisations
    3. Guidance and help sheets
    4. Regulatory monitoring
  13. CA jobs
    1. CA jobs partner: Rutherford Cross
    2. Resources for your job search
    3. Advertise with CA jobs
    4. Hays | A Trusted ICAS CA Jobs Partner
    5. Azets | What's your ambition?
  14. Work at ICAS
    1. Business centres
    2. Meet our team
    3. Benefits
    4. Vacancies
    5. Imagine your career at ICAS
  15. Contact us
    1. Technical and regulation queries
    2. ICAS logo request

ICAS publishes guidance on auditor evaluation

  • LinkedIn (opens new window)
  • Twitter (opens new window)
By Alice Telfer, Head of Business Policy and Public Sector, ICAS Policy Leadership

29 March 2019

Main points

  • ICAS publishes new guidance on auditor evaluation. Two separate guides explain current good practice and how to apply it proportionately to: private companies, publicly funded bodies and the not-for-profit sector.

  • Guidance identifies the principles of an effective audit and explains expectations around independence, professional scepticism and engaging non-audit services.

ICAS has published two new guides highlighting current good practice to support the evaluation of your auditor.

Each guide has been tailored to fit the circumstances of:

  • Private companies (SMEs)
  • Publicly funded, third sector and not-for-profit bodies.

A guide for audit committee members or board directors

The guide aims to help audit committee members or board directors, if no audit committee exists, but will be useful to anyone interested in the audit process.

Why it is important to evaluate your auditor

It is good business practice to ensure that goods and services are fit for purpose and offer value – this applies to audit as for any other significant purchase.

A regular evaluation of the auditor’s performance helps to ensure that you get the service needed for your organisation.

For public sector organisations which use a national framework where the auditor is appointed centrally, it is still important to actively review your auditor to enable two-way sharing of information and increase confidence in the quality of service.

All organisations should take an active role in evaluating how well the audit was performed both from a technical standpoint and from a customer service position.

What to expect from a good quality audit

The guidance clarifies what to expect from a good quality audit and how this benefits the organisation.

Key roles and responsibilities, how to approach the evaluation and how often this should be carried out are explained.

It also sets out the issues to consider when engaging non-audit services and articulates key principles of good practice to summarise what we are trying to achieve.  This is supported by a detailed checklist to guide audit committee members through the evaluation process.

Professional scepticism, critical appraisal and a questioning mind

One of the benefits of a quality audit is that the auditor can bring professional scepticism, critical appraisal and a questioning mind.  This can highlight issues in your organisation which are an opportunity or risks to be managed.

Constructive management challenge strengthens governance and reduces the opportunity for ‘group think’.  The auditor’s ability to demonstrate professional scepticism is crucial.

Approach to audit evaluation

The auditor should exercise competence and sound judgement throughout the audit process from planning and risk assessment to reporting.  Audit evaluation should be part of the audit committee’s on-going activities to monitor and assess effectiveness throughout the year, not just after the year-end.

While larger organisations may undertake a full assessment annually, it may be more appropriate for smaller entities to do this every two years, subject to an annual check-in, to identify if any triggers exist indicating the need for a full evaluation.

Audit independence

Audit independence is a key driver of quality audit.  The audit committee/equivalent is expected to take an active role to ensure the integrity, independence, objectivity and effectiveness of auditors, and be able to demonstrate this.

This includes not only the relationship auditors have with the organisation but also the arrangements within the audit firm itself to ensure they provide a professional and independent service.

Engaging non-audit services

Engaging non-audit services is under increasing scrutiny.  Every organisation should have a policy on this.  Whatever the size or type of organisation, the principle of ensuring independence is essential.

Our guides explain what this means in practice and what to look out for when deciding what other services your auditor can provide.


Find out more

A copy of the guides can be downloaded:

Private companies

Public funded, third sector and not-for-profit bodies


2022-11-mitigo 2022-11-mitigo
ICAS logo

Footer links

  • Contact us
  • Terms and conditions
  • Modern slavery statement
  • Privacy notice
  • CA magazine

Connect with ICAS

  • Facebook (opens new window) Facebook Icon
  • Twitter (opens new window) Twitter Icon
  • LinkedIn (opens new window) LinkedIn Icon
  • Instagram (opens new window) Instagram Icon

ICAS is a member of the following bodies

  • Consultative Committee of Accountancy Bodies (opens new window) Consultative Committee of Accountancy Bodies logo
  • Chartered Accountants Worldwide (opens new window) Chartered Accountants Worldwide logo
  • Global Accounting Alliance (opens new window) Global Accounting Alliance
  • International Federation of Accountants (opens new window) IFAC
  • Access Accountancy (opens new window) Access Acountancy

Charities

  • ICAS Foundation (opens new window) ICAS Foundation
  • SCABA (opens new window) scaba

Accreditations

  • ISO 9001 - RGB (opens new window)
© ICAS 2022

The mark and designation “CA” is a registered trade mark of The Institute of Chartered Accountants of Scotland (ICAS), and is available for use in the UK and EU only to members of ICAS. If you are not a member of ICAS, you should not use the “CA” mark and designation in the UK or EU in relation to accountancy, tax or insolvency services. The mark and designation “Chartered Accountant” is a registered trade mark of ICAS, the Institute of Chartered Accountants of England and Wales and Chartered Accountants Ireland. If you are not a member of one of these organisations, you should not use the “Chartered Accountant” mark and designation in the UK or EU in relation to these services. Further restrictions on the use of these marks also apply where you are a member.

ICAS logo

Our cookie policy

ICAS.com uses cookies which are essential for our website to work. We would also like to use analytical cookies to help us improve our website and your user experience. Any data collected is anonymised. Please have a look at the further information in our cookie policy and confirm if you are happy for us to use analytical cookies: