Corporate governance is a shared responsibility. It's not just on auditors
The corporate governance ecosystem is an intricate balance of multiple participants who act to generate long-term value for the firm - the board, management, audit committee and the internal and external auditors.
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WHEN a company falters, who takes the blame? Did the financial statements fail to communicate the underlying performance of the company? Were the disclosures inadequate in highlighting the key assumptions and judgements made when estimating the fair value of certain assets? Are investors aware that not all profits are the same, and that accounting standards do not require companies to clearly differentiate between unrealised and realised profits in the income statement? Unrealised profits could potentially be reversed, until they are, well, realised.
Auditors are not the sole guardians of public interest. Multiple stakeholders have a shared responsibility in this regard.
Roles and responsibilities
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