Financial Reporting Council's 2018 Audit Quality Review – record performance for BDO
August 06 2018
The Financial Reporting Council’s (FRC) Audit Quality Review (AQR) team has published its annual quality inspection reports of the Big Four, Grant Thornton, Mazars and BDO.
In total, eight of BDO’s audits were reviewed between February 2017 and January 2018. The AQR found that:
- Seven were deemed good with limited improvements required (grades 1 and 2a)
- One required improvements (grade 2b)
- None required significant improvements (grade 3)
BDO’s results are top of the table in percentage terms.
Scott Knight, Head of Audit at BDO LLP, comments:
“Our economy and capital markets rely on informative and accurate financial reporting. Independent audit plays a key role in that. Through its Audit Quality Review (AQR) team, the Financial Reporting Council (FRC) rightly continues to challenge the profession to raise its standards.
“We are proud that 88% of our firm’s audits reviewed in 2017/18 achieved the FRC’s top ranking for quality, with none requiring significant improvements. We recognise that we need to continue to make investments in our people and procedures in order to achieve and maintain the highest industry-wide standards.
“As we have said before, it is vital to increase choice and competition in the market. These results indicate that there is no clear link between audit firm size and audit quality and, for this further reason, we urge Audit Committee members, CFOs and CEOs to open their doors to firms beyond the Big Four.”