Strengthening Oversight : Improving the Quality of Statutory Audits in the Philippines
Since 2003, the Philippines have been striving to implement reforms aimed at improving audit quality. Oversight of the audit profession is a key control over the financial reporting architecture of a country’s private sector. A Quality Assurance...
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| Language: | English en_US |
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World Bank, Washington, DC
2016
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| Online Access: | http://documents.worldbank.org/curated/en/2016/05/26408211/philippines-strengthening-oversight-improving-quality-statutory-audits-philippines http://hdl.handle.net/10986/24723 |
| Summary: | Since 2003, the Philippines have been
striving to implement reforms aimed at improving audit
quality. Oversight of the audit profession is a key control
over the financial reporting architecture of a country’s
private sector. A Quality Assurance Review system over
audit practitioners is a subset of oversight which serves as
a key monitoring control over the integrity of financial
reporting. In keeping with the country’s strategic priority
of boosting private sector development by improving the
investment climate for firms of all sizes, including greater
access to finance, legislation was enacted to support the
objective of increasing the integrity of private sector
financial reporting through improved audit quality.
Accordingly, the Board of Accountancy was mandated with the
power to conduct oversight into the quality of audits of
financial statements through a review of the quality control
measures instituted by auditors in order to ensure
compliance with the accounting and auditing standards and
practices. . However, the injunction remains in place and,
accordingly, implementation of the mandated Quality
Assurance Review Program may not move forward. Several
concrete steps should be taken in order to effectively move
forward with the rollout of a comprehensive system of public
oversight including audit quality assurance in the
Philippines. These include (1) reforming the legal
framework to establish an effective audit oversight system
with sufficient legal power and authority (2) rationalizing
the statutory audit threshold to minimize the conditions
contributing to low quality audits, (3) building support
among key stakeholder groups by properly addressing their
concerns to the extent possible, (4) ensuring coordination
of efforts among regulators to eliminate gaps and overlaps
and foster collaboration among the group, and (5)
establishing a dedicated Project Management Office to
oversee the rollout of a Quality Assurance Review Program
over audit practitioners. |
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