How to Escape from “Audit Groundhog Day”: Idea 1: Have a rethink!

New thinking for innovation in audit comes from the RSA (Royal Society of Arts) and the ICAEW (Institute of Chartered Accountants England & Wales) in a joint report Enlightening Professions? A vision for audit and a better society. This report reworks our thinking on how audit could flourish.

Andrew Riley was at the launch event of this thought leadership document and reports in this personal blog.

In the words of the report executive summary – audit must help to build the trust in markets that business and society need to operate.

The problems are that (1) trust in auditors themselves is bruised (2) massive changes in information technology and social attitudes are making users of audit reports more sceptical and (3) the benefits of audit are getting harder to articulate.

This report calls for audit to move from a trust-producing product to a trust-producing practice. The auditor could use her or his position as a trusted intermediary to apply evidence based learning across all dimensions of the organisation and its stakeholders, and bring into consideration all aspects of the organisation’s value – economic, social and environmental.

Two key areas of the report stand out for me:

1. “From being a service consisting almost exclusively of external investigation by a warranted professional, modern technology will allow auditing to become more co-productive, with the auditor’s role expanding to include that of an expert convenor willing to share tools of enquiry” and
2. “The auditor of the future will be a multidisciplinary team member, operating within and between companies as the market takes on the form of flexible platforms and innovative start-ups.”

Michael Izza, chief executive of ICAEW speaking at the RSA launch report event spoke of the need for auditors to create sufficient escape velocity to break out of the Audit Groundhog Day effect, and to ask difficult questions to respond to all challenge of making audit a trust-producing practice.

The picture in this blog is from one of my favourite map artists, Georg Balthasar Probst (1731 – 1801) with an aspect of fruit gardens from the Frederick the Great’s Sansoucci Palace. Close to Berlin, the Sansoucci summer retreat was used by the busy Prussian King to get away from everyday life and have a rethink of the way forward − much like Enlightening Professions? A vision for audit and a better society recharges me to get the escape velocity to get out of Audit Groundhog Day

The difficult questions I am asking myself to get that escape velocity are:

• What are the big problems my clients and their customers are facing?
• What can my audit and assurance work do to make impact across the business I am auditing
• What innovations in ISAE 3000, ISAE 3402, AAF 02/07 and AAF 01/06 assurance reporting will be of most use to stakeholders?
• How can assurance work with internal auditors and compliance teams become more co-productive whilst maintaining independent audit rigour
• How can I best pioneer crowd-sourced audit tools on auditing culture into robust trust-producing audit practice?

What is most energising is the feeling that repeating the same practice and having another Audit Groundhog Day is not an option.

Please contact us on info@assureuk.co.uk if you have any questions.