Statutory Audit Services Market Study: Update Paper.pdf

TheCityUK responds to the Competition and Markets Authority's audit market study update paper, discussing the 'expectations gap' and the purpose and scope of audit. TheCityUK represents UK-based financial and related professional services, promoting policies for competitiveness and economic growth. They believe the audit market study, along with the Sir John Kingman review and the upcoming Brydon Review, aims to improve audit quality, choice, and governance.

The purpose of an audit is to provide an independent opinion on a company's financial statements, ensuring truth and fairness, and compliance with the Companies Act. Audit plays a vital role in building trust and transparency, facilitating capital formation, and reducing the cost of capital. It enables long-term savings, effective retirement planning, SME and corporate lending, capital investment, and fair and effective public spending.

TheCityUK recommends careful consideration of any changes to audit regulation and structure, prioritizing the scope of audit and company reporting. They emphasize the importance of understanding the kind of audit service users and stakeholders demand before implementing market remedies. TheCityUK looks forward to continuing engagement on these issues, ensuring possible proposals for reform prioritize UK competitiveness.