CEO's Message


January 2019 

CPAB has released its Strategic Plan 2019-21: Accelerating Audit Quality, designed to drive sustainable solutions to accelerate audit quality in Canada.  It’s intended to ensure CPAB remains agile and progressive in our approach to audit quality matters.

Over the next three years, CPAB will relentlessly pursue innovation, continuous improvement and next generation audit quality.  And we will be a beacon for regulatory excellence, professionalism and trust.   We’ll get there through four strategic commitments:

1. Cultivate a proactive, adaptive and innovative culture that elevates our regulatory effectiveness. 
CPAB will deepen its focus on leadership, building the team and culture enhancements to maximize organizational capability and position CPAB as an employer of choice.

2. Drive targeted, systemic changes to accelerate audit quality improvements.
 In Canada, public accounting firms must do more to fully embed audit quality – firm-wide systems that manage risk, emphasize strong governance and culture, and deploy highly trained professionals will be key to consistent audit execution. CPAB has introduced a comprehensive assessment of these quality systems.
3. Impact how the future audit is performed and regulated.
CPAB will proactively lead regulatory responses to current issues, and emerging industries and technologies impacting audit quality, and influence the setting of standards and guidance for auditors.
4. Influence global audit quality consistency.
CPAB will continue to drive our ability to access audit work of Canadian reporting issuers performed in foreign jurisdictions, collaborate with international regulators, and build on our presence as an international thought leader on audit quality matters.

CPAB is actively involved in a number of discussions related to the future of audit. I’d like to comment on two of them.

The first is technological disruption. Tech innovation is already affecting who does the audit, and how. Machine learning and artificial intelligence – or hybrid intelligence – have started to replace certain basic audit procedures once performed by people.  Blockchain and cryptocurrencies are replacing traditional systems in some industries or applications. As a regulator, we need to proactively evolve our inspection methodology and IT skills.
Innovation is just one force shaping the future audit. The public trust is another.

When international regulators asked CEOs of the world’s largest public accounting firms what things are most top of mind these days, trust was clearly one of them.   And while the overall financial system here in Canada is sound, there is room to improve.
For its part, CPAB is conducting systemic reviews of firm quality management systems. We are adding additional thematic inspections in new industries and to assess the implementation of new complex accounting standards.
We continue to be prevented from inspecting the work of components of Canadian public companies based in certain foreign jurisdictions. This creates obstacles to protecting public confidence in financial reporting in Canada. We are pushing standard setters to innovate and increase the pace of change.
I’m often asked what more I think the profession can do.  There are many potential actions at an audit firm level, and we are actively providing detailed recommendations in our annual reports to the audit firms. In my view, CPAs need to amp up the basics like professional skepticism, judgment and technical expertise, while actively learning about new tools and approaches. Keeping their sights on delivering high quality is critical to maintaining trust.
Finally, agility and willingness to do things differently is table stakes for the profession and for regulators – standing still, complacency, and lack of foresight is not an option.
You can read more detail about how we’ll bring our strategy to life, and how we’ll measure success here.

Check back here for updates on our journey.

Carol Paradine, CPA, CA

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