The Brydon report markedly expands the subject of an audit from the financial statements to take in the company itself, its directors and all information the company is required to disclose, but is this really the remit of the auditor, asks David Lineen, director, haysmacintyre
A commitment to seeking out what is ‘true and fair’ has been inculcated in auditors in the UK for decades and this was most recently reaffirmed in 2013, when Martin Moore QC, at the behest of the Financial Reporting Council, reviewed the continuing usefulness of the concept and concluded that it remained central to both preparing and auditing financial statements.
As the various demands society makes of business grow more varied and strident, some have questioned whether issuing accounts which have been certified by the auditor as ‘true and fair’ will be sufficient to inspire public confidence.
Recent government commissioned reviews, most notably the Brydon review, have wrestled with this issue. Indeed, Donald Brydon went so far as to propose an entirely new and somewhat revolutionary expansion of the purpose of an audit: ‘The purpose of an audit is to help establish and maintain deserved confidence in a company, in its directors and in the information for which they have responsibility to report, including the financial statements.’
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