Overall, 71% of audits were deemed good or generally acceptable, unchanged from the previous year, according to the latest ICAEW audit monitoring report 2023/24 but performance was down significantly on pre-pandemic results when 78% of audits achieved the same quality standard. In the last year, nearly three in 10 audits fell below the standard.

However, 8% of audits required ‘significant improvements’, up from 7% in the previous year.

Rama Krishnan, chair of ICAEW’s audit registration committee, said: ‘While there has been no deterioration in the overall result this year, it is slightly disappointing that overall performance has not improved.

‘There are indications that audit quality is being challenged by changing market conditions with an unprecedented movement of complex audits from larger to smaller firms which is requiring those smaller firms to move quickly to upscale their risk and quality processes.