Audit reflections during our new reality Audit reflections during our new reality

When I returned to the role of Global Head of Audit for KPMG International, I was expecting to feel a sense of familiarity with the organization, team and office space. However, it was impossible to know at the time that soon my office space would be my home in North Carolina, that I’d be meeting and connecting with my new team exclusively through a screen, and that the organization that I’ve come to know so well over the last 37 years would be facing one of the largest global challenges in our 150-year history. 

As I’ve begun reconnecting with our leaders across KPMG’s global network over the last month, it’s been inspiring to hear how different countries are responding to the coronavirus outbreak. I have felt immense pride in KPMG’s global network response to the COVID-19 pandemic – keeping the safety of our people as our guiding star and coming together across our business to collectively develop guidance and resources that will help protect our stakeholders, our global network of firms and serve the public interest. As the world faces such immense uncertainty, and as we all seek to overcome and recover from this awful pandemic, never has our role and professional responsibility to the public interest been more important. It is in these times that auditors and the profession need to “stand tall”, and ensure we are here to meet our responsibilities to the public interest and the global financial markets to work efficiently and in a sustainable manner.

As I take on the leadership of KPMG’s Global Audit practice during this new reality, there are two distinct things in my mind that have changed across the audit profession since I last held the role that I believe have helped prepare us for the challenge and that will carry our profession through to the other side of this pandemic and on the continued path to success: 

1. Auditors are using technology and innovation more effectively – The evolution of the audit profession in recent years has brought about new ways of working, including remote-work tools and virtual meetings. In response to the complexities of working with global corporations, the profession has helped lead the way in the adoption of new technologies and innovative approaches to coordinate with clients and allow auditors to collaborate with one another. This has enabled audit firms to quickly adapt to the new normal of remote work that we are currently facing, while remaining laser-focused on audit quality. At KPMG, we are committed to innovation and technology advancement in order to ensure that our teams can apply their industry knowledge to deliver deeper insights. 

2. There has been a level of intensity and increased focus on audit quality – The financial reporting world, the way we do business and the things that investors care about are rapidly changing and becoming more complex to navigate. Investors and a wide group of stakeholders need auditors and the audit profession to deliver a consistently high level of quality in what we do every day. Users of financial statements need high quality financial information and relevant disclosures from preparers in order to make well-informed decisions.  Issues regarding going concern, asset impairments, valuations, and many, many more will require extraordinary amounts of judgment as companies deal with a high degree of uncertainty and market volatility.  Our job is to carry out our responsibilities to evaluate these judgements no matter how difficult the present circumstances make that job.  This is what we do. Our audit regulators have a job to do by holding the audit profession accountable to a consistently high level of quality.  At KPMG, our job is to embrace that challenge. 

Despite facing the unprecedented challenges of the year ahead, I am optimistic for the future, and thankful to be navigating these waters with my colleagues. The COVID-19 pandemic has forced us to all think differently, and I know we will continue to respond to and embrace this challenge.

Larry Bradley was appointed KPMG International’s Global Head of Audit on 1 April 2020, a role he also held from 2013-2015.