Why Is It Important? How They Can Become More Effective Going Forward?

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Having identified the importance of ACs, and how they have started to change, it is important to think about how they can become more effective going forward. When discussing this topic, AP1 said: “There’s too much bad regulation and not enough good regulations at the moment. We should be giving people more, and better, guidance to help. The typical reaction is to add more regulation, but history shows this doesn’t necessarily change behaviour. Any further regulation needs to be really good – specific and direct. Regulators are putting more and more requirements into a system that isn’t working; need to fix this before adding more and they need to take a more innovative approach – a mixture and blending of roles between all external parties.” AP3 spoke similarly on this topic and said, “I believe there is likely to be more regulation going forward because of unavoidable governance failings. This has always been the approach and is likely to continue. SOX clearly does not work regarding ACs but it is still enforced. The EU are looking to the UK suggesting they should be doing more, and that things are a bit soft currently. I do not believe that regulations are meaningful, they are often too simple do not take into account contribution to boards. FRC stance of encourage best practice seems logical. There are suggestions that AC members should have formal qualifications – more failures makes this more likely to be brought in.” Clearly, from the auditor’s point of view,
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