New audit regulation won't improve independence - auditors

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(iStock)
(iStock)

Cape Town – The majority of stakeholders in the financial auditing sector told MPs on Friday that they are opposed to the intended implementation of the Mandatory Audit Firm Rotation (MAFR). 

In October 2016, the Independent Regulatory Board for Auditors (IRBA) published a consultation paper about the proposed new framework, which will change the way in which companies appoint auditors. 

In terms of the new measure (MAFR), an audit firm wont’ be allowed to serve as the registered auditor of a listed company for more than 10 consecutive financial years. Furthermore, the same audit firm can only be reappointed after the expiry of at least five financial years. MAFR will be effective for the financial years on or after 1 April 2023.

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