The latest FRC annual audit firm inspection indicate continued improvement in audit quality, especially among Tier 1 Firms.
Five out of the six (BDO, Deloitte, EY, Forvis Mazars, KPMG, and PwC) achieved positive audit quality outcomes on 90% or more of their audits.
However, the FRC said while Forvis Mazars has shown significant gains in audit quality, continued effort is needed by the firm to ensure lasting improvement.
Worryingly, BDO continued to demonstrate recurring audit quality issues, and the FRC stressed the firm must urgently and robustly reassess how to improve its audit quality in these areas.
Of the 14 audits FRC inspected by BDO, four (29%) were found to require significant improvements. There were, again, recurring findings related to the challenge and testing of estimates and assumptions, the audit of revenue, and quality control procedures, plus we have identified findings in other areas including audit planning procedures.
