STRAIGHT TALK
MARK BARNES: Don’t fire the auditors, rather sack the management
Auditors are simply too boring to be crooks. Most of them also have a limited sense of humour, so I’ll probably get into trouble for saying that — but not as much trouble as they’re in though, for not saying things they should have. It’s not simple. Auditors don’t make the pictures, they take them. They take the photographs of what management has done, or at least said it has done. Auditors don’t write the exams, they mark them. The trouble is they don’t get to set the questions. It has become increasingly onerous to work through the accounting policies and audit opinions expressed in the financial statements of major companies. Even if you get through all the notes to the financials, how much wiser are you to the basket of risks facing a firm, especially one operating in a multi-jurisdiction economy? The truth is, we’ve stopped reading. Like a lot of people who read this paper, I have sat on many an audit committee and chaired a few. Beyond compliance and accurate reporting, I have...
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