Common findings from the 2022 & 2021 ICAS audit monitoring visits
Michael Lavender, ICAS Audit Monitoring’s Senior Regulatory Reviewer, shares some key insights on what we found during our 2022 monitoring visits, to help give some food for thought when firms are establishing their Systems of Quality Management under ISQM (UK) 1.
2022 was an unusual year for ICAS Audit Monitoring, which saw a significant degree of change in the review team. There were fewer audit monitoring visits conducted, with focus being on firms that had not been visited for six years. As the visit schedule was somewhat different to a ‘typical’ year, we expect that the visit findings might not be readily comparable to previous years. However, there are still key themes and common findings that all audit registered firms should take in to account.
Every file reviewed in 2022 was considered to require some degree of improvement, with no files being considered a grade 1, or “satisfactory”, standard. This was a concerning result, with 67% of the files requiring more than limited improvements.
Audit file quality 2021 & 2022
Most common International Standards on Auditing (ISAs) (UK) breaches
The most common ISA breaches identified in our monitoring work during 2022 related to:
- ISA (UK) 230 – Documentation (79% of visits)
- ISA (UK) 500 – Audit evidence (71% of visits)
- ISA (UK) 315 – Risk assessment (57% of visits)
- ISA (UK) 240 – Fraud (50% of visits)
- ISA (UK) 550 – Related parties (43% of visits)
Further detail on the common issue identified relating to these ISAs, and some guidance with regards improving levels of compliance, is given within the report.
Common breaches of the Audit Regulations
Audit Regulations breaches were noted over the following areas in 2022:
- Audit Regulation 3.10 - Compliance with the ISAs (UK)
- Audit Regulation 3.20 - Audit Compliance Review (50% of visits)
- Audit Regulation 3.03 – Acceptance and reappointment (43% of visits)
- Audit Regulation 3.08 – Statutory requirements (43% of visits)
- Audit Regulation 2.03 - Audit eligibility (14% of visits)
- Again, further detail on the issues raised under these Audit Regulations is provided in the monitoring report.
For more information on the common findings identified in the 2022 monitoring visits:
Read the full report
