In August, the AICPA released a discussion paper about enhancing audit quality.  The discussion paper was a comprehensive review of the AICPA’s short term plans and long term ideas about steps that can be taken to ensure that the quality of audits is and continues to be at a high level.

The INCPAS Board of Directors appointed a task force of members to review the discussion paper and respond to the questions in it.

This movement toward enhanced audit quality and the resulting discussion paper is part of the AICPA’s response to these broader emerging issues within the CPA profession:


  • Complexity in business and underlying standards
  • Pace of change
  • Continued audit relevance
  • Peer review and inspection results
  • Regulators’ scrutiny
  • Expanding services

The AICPA identified the following as elements of quality:

  • Competence and due care
  • Standards (Audit and Quality Control)
  • Guidance, tools, learning and resources
  • Monitoring and Enforcement

Some of the initiatives proposed ranged from changes to the CPA Exam and to CPE, better resources and guidance, working to better understand where and how audit deficiencies occur and their root cause, performing more extensive peer review procedures on high risk areas, transitioning to real time practice monitoring, improving peer reviewer quality through testing and specialized training, and making peer review results more informative.

Our task force reviewed the discussion paper and offered our feedback on the various initiatives.  Overall, we were supportive of the efforts to enhance audit quality, but concerned that some of the initiatives could present barriers for smaller firms conducting audits in high risk areas.   Additionally, we felt that more could be done to improve guidance, and the availability of resources and other tools to practitioners, particularly through providing more real-life examples of how to apply standards.

Whether or not we like it, change is happening and needs to happen to ensure that audits maintain high standards in quality to protect their long term relevance.  If we as a profession don’t act to ensure that our work is of a high quality, regulators are likely to step in and take their own steps to address audit quality issues.  We will continue to monitor these efforts and share feedback with the AICPA and other groups working to make changes to enhance audit quality.

More information about the Enhancing Audit Quality initiatives can be found here.

What are your thoughts on audit quality?