OSC issues report on internal ethics policies and procedures of public accounting firms

TORONTO – The Ontario Securities Commission (OSC) today published a report to assist public accounting firms in developing and implementing robust internal ethical policies and procedures.

On September 23, 2022, the OSC announced it would make targeted inquiries to certain public accounting firms that conduct audits of Ontario reporting issuers. The report published today summarizes the scope of these inquiries and communicates observations about the internal policies, practices, and procedures in place at these firms.

“The public trusts auditors to act ethically and with integrity in upholding their role as gatekeepers to Ontario’s capital markets,” said Grant Vingoe, CEO of the OSC. “It is critical that all public accounting firms work to foster internal cultures of compliance by establishing policies and procedures that encourage the highest ethical behaviour.”

The report identifies select areas of focus public accounting firms should consider as part of their ethics strategies, such as clearly identifying leaders within the firm with ‘ownership’ of the ethics policies, targeted ethics education training and guidance, and establishing a robust internal whistleblower program. It also provides considerations to help firms comply with requirements related to the dating of audit working papers and internal professional training programs.

OSC Staff Notice 52-724 Considerations for Public Accounting Firms in Developing Internal Ethics Policies and Procedures is available on the OSC’s website.

The mandate of the OSC is to provide protection to investors from unfair, improper or fraudulent practices, to foster fair, efficient and competitive capital markets and confidence in the capital markets, to foster capital formation, and to contribute to the stability of the financial system and the reduction of systemic risk. Investors are urged to check the registration of any persons or company offering an investment opportunity and to review the OSC investor materials available at https://www.osc.ca.

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