Reliability should be viewed as a key element in judging audit quality, according to a discussion paper from the Audit Quality Forum (AQF).

The AQF, whose members include investors, businesses, auditors and regulatory bodies, argues that looking at audit through the reliability concept provides a new perspective on current issues such as audit quality, expectation gaps and scepticism.

Introducing the paper, Reliability Matters: Reliability and the Central Role of the Auditor, Robert Hodgkinson, ICAEW executive director, said: 'The inputs to an audit are of course very important, but ultimately audit quality has to be judged by how reliable the audited financial information is in the eyes of users. Focusing on reliability as a central concept in auditing should put more emphasis on outcomes and on what users want and need.'

The paper explores what this means for auditors and identifies five aspects of reliability and the challenges they entail. Auditors need to ensure that information is properly measured, meets its intended purpose and is robust also for other uses. The paper also explains why auditors need to consider the reliability of the organisations they audit and their own firms' reliability.

The AQF says auditors need to consider what practical steps to take to engage with users of audited financial statements, how to balance the need for reliability with the need for risk taking and how to maintain confidence in the reliability of audited financial statements when business failures occur.