According to reports from Mint, Lee White, chief executive of the International Federation of Accountants (IFAC), emphasized that fears of auditors losing their jobs to artificial intelligence have considerably subsided. However, he warned that accountants must adopt technology rapidly while retaining core human skills and professional ethics to achieve audit excellence. White noted that accountancy has always been a technology-led profession, but the current AI evolution represents quite rapid change with great opportunities for the profession to enhance skill sets. As reported by Mint, White flagged the rapidly evolving nature of AI and advised auditors to embrace it to upgrade their skills and generate insights, while maintaining that professional scepticism, which is an expectation of their profession, is also expected by regulator colleagues.
As reported by Mint, Jean Bouquot, president of IFAC, stressed that accountants need to exercise professional scepticism in pursuit of audit excellence. Bouquot suggested that the question of AI displacing auditors is now behind, but earning and maintaining stakeholders' trust in audit work remains a continuous work in progress. The global body, which has 188 members including the Institute of Chartered Accountants of India (ICAI), held its first board meeting in India between 2-3 September to discuss technological transformation and India's role in driving tech-led innovation. White emphasized that auditors must continue to earn public trust through ethical practices, while always being alive to learning, relying heavily on core skills, maintaining strength of ethics, but embracing technology.
According to Mint, the Public Company Accounting Oversight Board of the US recently asked stakeholders if it should explore standard-setting in AI adoption. India's National Financial Reporting Authority issued general principles on AI adoption in July, encouraging use of latest tools while emphasizing that audit quality responsibility lies solely with the auditor. The intersection of AI and auditing has come under the spotlight in recent months, as technological advances not only make it easier for both auditors and auditees to source and use information quickly, but can also influence auditors' judgements. This has prompted audit watchdogs worldwide to weigh the need for new regulations to ensure that this intersection doesn't lead to unintended consequences, with gaps in AI adoption remaining stark across countries.
As reported by Mint, with sustainability reporting gaining global traction, White called on auditors to build necessary skill sets and familiarize themselves with jurisdiction-specific rules. The Securities and Exchange Board of India (Sebi) has mandated that top 1,000 listed companies comply with Business Responsibility and Sustainability Reporting framework covering ESG aspects including environmental resource management, emissions, biodiversity, climate change mitigation and adaptation. The IFAC has established the ISSA 5,000 standard for professional auditors to handle sustainability assurance work, with India's ICAI also establishing sustainability reporting standards for auditors. These include disclosures on environmental resource management, emissions, biodiversity, climate change mitigation and adaptation.
According to Mint, White explained that there is a framework within IFAC facilitating mutual recognition of degrees among its 188 members, though broader matters are often negotiated bilaterally. Mutual recognition agreements are crucial for India, as they allow the country's more than 4,67,000 chartered accountants to offer services in other jurisdictions on a reciprocal basis. The ICAI has signed mutual recognition agreements with accounting bodies of Australia, New Zealand, England and Wales, South Africa, Canada, Malaysia, and Nepal to enable qualified accountants to obtain reciprocal membership through bridging mechanisms.
