Overseeing the external auditor

A guide to performing a periodic comprehensive review

The Periodic Comprehensive Review of the External Auditor is uniquely Canadian. It’s our country’s response to the question of regulators around the world about how to best address potential familiarity and self-interest threats posed by the long tenure of an external auditor.

The number of comprehensive reviews conducted in Canada since 2013 likely falls well below the expectations of regulators and professional bodies. Why? From our experience, it appears many audit committees struggle to appreciate the value and are unsure how to best perform one.

In response, we’ve developed this guide to help audit committees explore the value of conducting a comprehensive review and understand the key phases necessary to effectively execute it. We also share our own insights gathered from experience, and provide tips and answers to frequently asked questions of audit committees.

We asked audit committees that have conducted a comprehensive review to share their perspectives on its benefits. Here’s what they’ve told us.

Enhances transparency

The process enables the audit committee to have a better understanding of the openness and candour of the relationship between management and the external auditor.

Enables interaction with senior firm leadership

It provides an opportunity for the audit committee chair to interact with the firm’s senior leadership to understand the audit firm’s quality initiatives, which may otherwise not be discussed at audit committee meetings.

Defines audit quality

It challenges the committee members' perception of audit quality by examining what it really means to them in the context of their responsibilities as directors.

Delivers insights

It identifies topics that audit committees may not have realized the auditor already considers within its audit scope, thereby leading to agreed-upon actions to enhance the robustness of discussions throughout the audit.

How can an audit committee maximize the value of a comprehensive review?

Download our step-by-step guide to get started today.

Download the guide