The following letter to the editor was published in the Australian Financial Review on Wednesday, 3 June 2009 
 
Your "Regulator to crack down on auditors" (June 2) article implies that the external auditing process should safeguard against corporate collapses. Moreoever, it suggests the quality of financial reporting and auditing in Australia is less than satisfactory. This is incorrect. 
 
Some do see audit as a guarantee to prevent poor management behaviour, bad business decisions or ultimately corporate failure. It is none of these. An audit enhances the accountability or corporate stewardship to its shareholders. Let's be clear - a corporate failure does not equate to audit failure.  
 
This forthcoming reporting period to June 30 will be a challenge, one we haven't seen in decades. However, we should also recognise the robustness of the external audit to date. 
 
The Australian Securities and Investments Commission in its last public inspection report of auditors for the 18 months to December 2007, stated that Australia had a well-resourced and skilled audit profession committed to independence and audit quality. 
 
This view is shared by the Institute of Chartered Accountants in Australia (the Institute), through its extensive quality assurance program. 
 
The role of audit can be better communicated and understood by all in the market. The Institute recognises that at this important time it needs to lead amarket-based, forward-looking agenda on ensuring the role of the external audit is well understood and valued. The Institute is committed to providing preparers of financial reports, audit committees and auditors themselves with practical tools and guidance to assist them undertake their professional responsibilities . 
 
In this regard the Institute has recently published guidance that focuses on fair value, asset impairment and going concern to assist all parties directly involved in preparing and auditing financial year-end statements.  
 
Lee White 
General Manager of Leadership and Quality  
Institute of Chartered Accountants in Australia