Enhanced disclosures, along with related metrics, can promote important dialogue and deepen the understanding of audit quality, according to a new resource published by the Center for Audit Quality (CAQ). The Audit Quality Disclosure Framework (PDF) assists firms in their ongoing efforts to develop such disclosures, which many accounting firms now provide through annual transparency or audit quality reports. Developed in consultation with a range of CAQ member firms, the Framework adheres to three key principles:
- The Framework is voluntary and illustrative, as opposed to prescriptive or all-inclusive.
- The Framework is flexible, giving firms the ability to tailor the information that is most relevant and meaningful to audit quality.
- The Framework relates to disclosure of a system of quality control at a firm level, rather than at the engagement level.