It is very important to emphasise that any individual or firm signing audit reports must be a Registered Auditor. All ICAS Registered Auditors (i.e. firms registered to conduct audit work by ICAS) must receive a monitoring visit from ICAS Audit Monitoring as part of the requirements of audit registration.
Why is an Audit Monitoring visit required and what are the objectives of an Audit Monitoring visit?
Audit Monitoring has been in place in the UK since 1990. Audit regulation originally arose from the 8th European Directive on company law and whilst the original directive did not include a monitoring requirement, the UK government, ahead of many other countries, made this a statutory requirement under the Companies Act 1989 (now superseded).
The current revised 8th European Directive, enacted in the UK by the Companies Act 2006 now requires all European auditors to be subject to monitoring and ICAS is required to comply with the EU 8th Directive requirements.
In addition, as a member of the International Federation of Accountants (IFAC), ICAS is also obliged to ensure that it makes "best endeavours" to comply with IFAC's members obligations for audit monitoring.
Who conducts the Audit Monitoring visits?
The Audit Monitoring team is made up of Chartered Accountants who have significant experience from an audit practice background. All of the team have both large firm listed audit experience and a number also have smaller firm audit experience. All Reviewers enter an in-depth induction and training programme when they join and, thereafter, receive ongoing training and supervision.
What are the Reviewer Procedures?
The monitoring unit's procedures and processes are contained within a detailed visit methodology that the Audit Monitoring team must follow.
The Reviewers are also bound to comply with the Institute's continuing professional development and independence requirements.
ICAS audit firms are required, under the Audit Regulations, to provide access to all aspects of their audit practice and to the audit engagement files to the monitoring unit. In turn, the monitoring unit is bound by strict confidentiality rules regarding the audit client information reviewed.
The responsibilities, duties and powers of the monitoring unit and the Committee to whom it reports are contained within the Audit Regulations.Further details of the monitoring process can be found on our Audit Monitoring Visit Process page.