Research commissioned by BDO Stoy Hayward shows that those running the UK’s biggest investment funds condemn the current lack of transparency on the quality of services provided by individual audit firms.

Nine out of ten respondents said they support proposals to make reports by the Audit Inspection Unit (“AIU”) on individual audit firms publicly available.

The poll of sixty institutional investors and forty analysts, by Ipsos MORI on behalf of BDO Stoy Hayward, reveals that the availability of such information could play a crucial role in alleviating continuing concerns about the robustness of company financial data caused by accounting scandals such as Enron, Worldcom and Parmalat.  Three quarters of those quizzed believe making the information available would have a positive impact in this area, while a further nine out of ten consider the information as potentially valuable to the investment community.

Jeremy Newman, Managing Partner, BDO Stoy Hayward commented:  “The findings of this research are clear proof that the investment community still has concerns arising from the accounting scandals of the last five years.  According to them, a greater level of transparency around the quality of individual audit firms is the right way to build trust and allay residual concerns."

“Whilst proposals to publish AIU reports are undoubtedly a step in the right direction, it is vital that the public reports contain sufficient detail to be of real value to investors and other stakeholders.  It is also important that they report on strengths of the audit firms, as well as raising any concerns, if we are to fully restore confidence in the audit process.”

The study also suggests that the Audit Inspection Unit may have a task on its hands to build its own profile to ensure that the reports are considered authoritative and credible. Of those polled, eight out of ten claimed never to have heard of the Audit Inspection Unit, showing a low level of awareness.

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