IRBA Newsletter Issue 54

Issue 54 | April-June 2021 2 ACTING CEO’S PERSPECTIVE SIGNIFICANT STEPS FORWARD In the past quarter, the IRBA has taken significant steps towards stability in its governance structure; it has also moved its strategic initiatives forward. First and foremost, we are enthusiastic about our new Board, which was recently appointed by the Minister of Finance (see page 24 for the full list). The Board has already had its first meeting and we look forward to implementing our strategy with its guidance, as we embark on a journey to restore confidence and trust in the profession and the regulator. During the interim period under the Caretaker Board, our management and employees continued to execute our mandate unabated and with commitment, demonstrating a resilient spirit and willingness to rebuild trust in our profession and the regulator. I have had very positive and optimistic conversations with various stakeholders about our refocused strategy and it is clear that actions are starting to manifest at different levels. Thus far, our stakeholders support our plans to address gaps in the broader financial reporting and governance ecosystem, to reshape the future of our profession. Our specific focus continues to be on implementing our refocused five-year strategy, which was adopted by Parliament in March. We have concluded our roadmap and have created three work streams that are led by our directors, to guide the ongoing implementation of our restoring confidence projects. The work streams will focus on the following key areas: 1. Financial Reporting and Governance Ecosystem • Analysis of the broader financial and governance ecosystem, with a specific focus on identifying areas that impact audit quality. 2. Auditing Profession • Analysis of the auditing profession itself and identifying measures to address significant gaps where reform or guidance may be required. 3. IRBA • Fees and resourcing; • Investigations capacity; • Implementing the Auditing Profession Amendment Act; • Transformation of the profession; • RA brand; • Digital (platforms, business intelligence and data analytics); and • Improved communication and visibility of the regulator. We have also taken stock of what we have achieved since early 2018, and what still needs to be done. The Auditing Profession Amendment Act was assented to by the President in April, and we are advanced in the process of implementing the various changes in terms of the amendments. Our implementation plan consists of 11 projects that include developing a regulatory strategy; reconstituting the Board; strengthening our investigation and disciplinary powers by firming up our Investigating Committee, Enforcement Committee and Disciplinary Committee; assessing the compliance of registered auditors (RAs) that are on our register through revised registration requirements; updating reportable irregularities guidelines; the referral of non-audit complaints to accredited professional bodies; the development of subpoena, and search and seizure guidelines; amending the Disciplinary Rules; and proposing to the Minister maximum monetary sanctions for improper conduct by RAs. Globally, our international participation was re-affirmed and bolstered by our re-election to the board of the International Forum of Independent Audit Regulators (IFIAR) for another four-year term. This means we will continue to play an important role in its mission to serve the public interest, including investors, by enhancing audit oversight globally; and it is also our mission to do so locally. During the quarter, our Inspections Department announced its 8 th Inspections Cycle Strategy and Process, which is aligned to the IRBA’s refocused strategy. As a result, the following key changes have been introduced in this cycle: • Comprehensive stakeholder engagement; • Guided proactive monitoring of remediation initiatives; • Theme-based inspections; • An enhanced business intelligence process; and • Enhanced reporting. The 8 th Inspections Cycle and Process can be downloaded on the IRBA website . As we continue to implement our refocused strategy, we will be sharing some of the key initiatives and interactions that have already begun with stakeholders. We look forward to these discussions and the feedback we will receive. The collective effort and ideas that will come forth will certainly help us set the auditing profession and the regulator on a new revitalised path. Imre Nagy Acting Chief Executive Officer