Thought Leadership

Audit reform stalled, frustration or opportunity?

Whatever the reasons given for the decision, and there are many, the twists and turns of the journey have not helped the profession. They created a new expectation gap for audit firms, making it difficult to plan and make key strategic decisions with confidence. Some of the narratives expressed during this journey portrayed the profession unfavourably and may well have influenced the thinking of those people making career choices to enter or remain in the profession.

Some commentators highlight that the absence of audit reform may increase the risk of audit failure. This may well be true, but the pause in audit reform may benefit our profession. I say this as a challenge with regulation is that it is often rules-based. As well-intentioned as those rules are, they don’t necessarily change behaviours such as professional scepticism and challenge. As a profession, it would do us no harm to use this pause to address these actual and perceived shortcomings ourselves, which may reduce the nature and scale of future regulation and restore trust in, and the attractiveness of our profession.

Late last year and early this year, we heard from the FRC, ICAEW and CPIA that the quality of, and confidence in, audit is improving. Rather than lamenting the shelving of audit reform, we should leverage advances in technology to reimagine and re-engineer our audit firms to maintain, if not accelerate, the inroads being made into quality improvement.

The debate on audit reform and regulation is important, but it feels a little philosophical when there is more than enough going on that impacts firms and their audit teams now.

Read the rest of the article on the Circit website and discover why 2026 is the year to refresh your IT and AI strategies, your business model, and how to increase the value of your practice.