On 12 November 2018, the Department for Business, Energy and Industrial Strategy Committee (the "BEIS Committee") launched an inquiry into the future of audit, focusing on the likely impacts of the market study launched by the CMA (see above) and the Kingman review (further details of which are addressed below).
In particular, the BEIS Committee is inviting evidence on the following areas:
- The relationship between competition and quality in the audit market and how reforms in one area should complement the other.
- Whether there is agreement with the CMA and Kingman proposals, whether the remedies proposed by the CMA are likely to increase quality and trust in audits and whether there are any potential unintended consequences.
- The extent to which conflicts of interest undermine trust in audits and how they can be removed or mitigated.
- The importance of the relationship between the auditor and audited company to the quality of audit, how to ensure there is the right level of challenge and the role of shareholders in ensuring high-quality audits.
- Whether there is consistency between the proposed audit reforms and other recent reforms of corporate governance and whether any consequential reforms are required.
The deadline for written submissions is 11 January 2019 and the inquiry announcement can be accessed here.
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