Re-mediation is Key to improving Overall Quality of Audit Work

Friday, 18 May 2012 04:31

Kuala Lumpur, 25 April 2012: The Audit Oversight Board (AOB) today released its Annual Report 2011 which noted that audit firms are responding to the findings of inspections by implementing remediation plans to improve the overall quality of their audit work.

In 2011, the AOB, which was established by the Securities Commission Malaysia (SC) to oversee the auditors of PIEs, conducted inspections on 17 audit firms, which audit over 98% of the market capitalisation of public-listed companies (PIEs) or 86% of the total number of PIEs. During the year, the AOB also commenced the review of remediation plans proposed by the audit firms that were inspected.

By the end of 2011, 16 final regular inspection reports had been issued, six were pending finalisation and 13 remediation plans were approved. The 13 remediation plans, which focus on the strengthening of governance structure, improvement of methodology and the rebalancing of partners' portfolio and workload, are currently at various stages of implementation.

While the AOB will continue to inspect audit firms through its annual audit inspection programme, a critical component of the AOB's task is to monitor audit firms' remediation progress to close the gaps identified, in order to improve the overall quality and ensure the effectiveness of audit work performed.

Source: Securities Commission Malaysia