Addressing Audit Quality Concerns

In response to the high number of significant deficiencies previously reported in our 2021 Practice Inspection Report, and actions taken by regulators in Canada and other markets, including the U.S. and the U.K., CPA Ontario recently released an update on our efforts to address audit quality concerns.

In accordance with our legislative mandate to protect the public and our responsibility to uphold the high standards of the CPA profession in Ontario, we have recently begun a review of public accounting firms.

This review encompasses public accounting firms in Ontario that conduct audits of reporting issuers to ensure quality management, policies, procedures and cultural practices comply with the CPA Code of Professional Conduct, Public Accounting Act, 2004, the Chartered Professional Accountants of Ontario Act, 2017 and Quality Management Standards. Firms involved in this review have already been notified.

In addition, CPA Ontario will review individual Public Accounting Licence holders who audit reporting issuers to ensure their Continuing Professional Development (CPD) meets the requirements of the Code of Professional Conduct, CPA Ontario regulations and international technical competence and ethics standards. We will also enhance our oversight of CPD reporting by CPAs who apply for a new Public Accounting Licence.

We recognize the critically important role that public accountants and the audits they provide, play in preserving the trust placed in Canada’s capital markets. We will continue to monitor the audit environment and take necessary actions to ensure that public accounting in Ontario meets the high standards set out by the profession.