Auditors will be forced to challenge company reports in UK
The City watchdog has published a series of proposals aimed at improving auditing standards.
They include ensuring auditors make "greater effort to more robustly challenge management assessment of going concern, thoroughly test the adequacy of supporting evidence, evaluate the risk of management bias and make greater use of the viability statement".
In addition, the FRC is calling for improved transparency. Under the proposals, auditors would have to provide a statement on whether the management's assessment is appropriate and explain how they have come to that conclusion.
The consultation which closes on 7 June follows a raft of high-profile accountancy scandals that auditors failed to spot. ■