Original content provided by BDO Australia.
As we move forward in 2022, lingering issues include advances in governance oversight, multiplying enterprise risks, demands for increased transparency in reporting, changes to tax policy and the effects of the COVID-19 pandemic.
To prepare for the year ahead, audit committees should expect an expanding array of responsibilities and actively seek education that will contribute to audit quality and the integrity of financial reporting. Below are five key areas that should be top of mind for audit committees in the coming year.
How Audit Committees Can Prepare for the Year Ahead
Governance responsibilities continue to evolve and increase in importance and accountability. Audit committees should ensure they are prepared with an understanding of their expanded roles and responsibilities, and that they have adequate resources to execute those increasingly complex areas. At its core, the audit committee is responsible for the oversight of financial reporting, external and internal auditors, compliance, ethics, and controls. Increasingly, the committee is charged with additional responsibilities such as ERM and all that encompasses, digital transformation, cybersecurity and ESG.
The audit committee can prepare for the coming year by ensuring clear communication and collaboration with management, the full board, and other committees along with its advisers. Continuous education on emerging topics of interest and an eye on trends serves to keep directors knowledgeable and relevant. Keeping the company’s vision and strategy in mind is key as the audit committee helps leadership mitigate risk and identify new opportunities in the coming year.
These are just some of the many issues that audit committees are facing as they exercise their oversight responsibilities. We encourage audit committees to maintain continuous and considered communications with their auditor, be diligent in their continued education including remaining abreast of industry trends.
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