KPMG Outlines Priorities for Boards and Audit Committees; A Careful Balance of Near-Term Focus, Agility, and Long-Term Thinking Needed
Helping the company focus on long-term performance, navigate technology-driven disruption and digital transformation, and be attuned to corporate culture and other reputational risks should be high on board agendas in 2018, according to U.S. audit, tax and advisory firm KPMG LLP’s Board Leadership Center (BLC).
Drawing on insights from the Center’s work and interactions with corporate directors and business leaders throughout the year, the BLC’s On the 2018 board agenda highlights six items for directors to keep front and center in the months ahead:
“Navigating near-term risks and opportunities while staying focused on long-term performance will be particularly challenging in 2018,” said Dennis T. Whalen, leader of the KPMG Board Leadership Center. “Whether it’s digital disruption or cyber security, the business implications of environmental and social issues, or designing the right board for the company’s future, the year ahead will require focused, yet flexible board agendas.”
In addition, KPMG’s On the 2018 audit committee agenda highlights risk and regulatory issues that should be high on audit committee agendas. In addition to their primary focus on financial reporting integrity and audit quality, key areas of focus for audit committees in the year ahead include monitoring the company’s implementation of major accounting changes, such as the revenue recognition and lease accounting standards; the finance organization’s leadership and bench strength; and the audit committee’s workload and effectiveness.
“The new year is a good time to step back and reevaluate whether the audit committee’s agenda and focus have kept pace with changes in the business and regulatory environment,” said Jose R. Rodriguez, partner in charge and executive director of the KPMG Audit Committee Institute. “Financial reporting, internal controls and compliance, and audit quality are first and foremost. Audit committees will also want to stay focused on disclosures related to the implementation of the new revenue recognition, leasing, and financial instruments standards and tax-related developments that may impact the company. Helping to set the right tone from the top should also be a priority.”
The KPMG Board Leadership Center champions outstanding governance to help drive long-term corporate value and enhance investor confidence. Through an array of programs and perspectives—including KPMG’s Audit Committee Institute, the WomenCorporateDirectors Foundation, and more—the Center engages with directors and business leaders to help articulate their challenges and promote continuous improvement of public- and private-company governance. Drawing on insights from KPMG professionals and governance experts worldwide, the Center delivers practical thought leadership—on risk and strategy, talent and technology, globalization and compliance, financial reporting and audit quality, and more—all through a board lens. Learn more at kpmg.com/blc.
KPMG LLP, the audit, tax and advisory firm (www.kpmg.com/us), is the independent U.S. member firm of KPMG International Cooperative (“KPMG International”). KPMG International’s independent member firms have 189,000 professionals, including more than 9,000 partners, in 152 countries.