ASIC Audit Inspection Report 2021

30 November 2021

At BDO, a big part of what we do as auditors is provide trust in the financial system and support investor confidence.  As we continue to navigate the ongoing impacts of the COVID-19 pandemic, our focus remains not only on audit quality but also on the health, safety and wellbeing of our people, clients and communities.

We take our public interest responsibilities seriously and, as part of our commitment to transparency, each year we publish our Transparency Report, demonstrating how we deliver quality audits that provide trust.

In recognition of the need for more transparency, we also publish our ASIC Audit Inspection Reports.

ASIC undertake annual inspections of BDO’s audit files to promote improvements and maintenance of audit quality.

ASIC has released its findings of the reviews of key areas in audits conducted by BDO in the 12 months to 30 June 2021. In ASIC’s view, they considered we did not obtain reasonable assurance the financial report was free of material misstatement (negative findings) in two of the ten key areas reviewed (20%). This level of findings is consistent with that for the year ended 30 June 2020 (20%). There were negative findings in 32% of areas reviewed across all firms inspected by ASIC and 23% in areas reviewed across the largest six firms. The BDO result is the second best of the largest six firms.

Many of the key areas reviewed by ASIC required significant professional judgement and subjectivity. While we may not agree with some of the views formed by ASIC, we incorporate these findings with the results of our own internal inspections and use these outcomes to continually improve our processes and systems that support audit quality.

It’s important to remember, and ASIC concurs, there is more than one measure of audit quality. We understand the importance of having a culture of quality embedded into our actions and behaviours. In addition to the ASIC report, we have our own robust internal inspections program (IIP), monitoring programs within our risk and quality group and our annual Audit Quality Culture Survey. We also have an inspection program managed by BDO Global.

These measures indicate BDO’s audit quality is high and the findings over a number of years indicate this standard has been maintained.

We remain committed to strengthening our culture of quality which is based on:

  • Embedding our strong values
  • Demonstrating our technical knowledge
  • Striving for quality in all we do
  • Having the right people.

The table below sets out the BDO results of recent ASIC Audit Inspections: 

12 months to 30 June 2021 12 months to 30 June 2020 12 months to 30 June 2019 18 months to 30 June 2018
Number of files reviewed 3 3 2 3
Number of key areas reviewed 10 10 7 12
Number of key areas with findings 2 2 2 1
% of key areas with findings 20% 20% 29% 8%

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