26-260MR ASIC surveillance shows financial reporting and audit quality continues to fall short

The regulator is signalling that preparers and auditors continue to miss core reporting and audit fundamentals, which raises the risk of restatements, delayed reporting, regulatory scrutiny and reputational damage. For compliance and finance teams, the priority is to test reporting controls before the next cycle, not merely react after review. Audit committees should challenge management assumptions, evidence material judgements and ensure disclosures are complete and consistent.

Auditors should reinforce quality management, supervision and documentation, particularly where complex estimates or sector-specific risks are involved. Firms should also track recurring ASIC findings and map them against internal processes, governance and training. Although no new rules or deadlines are announced, the direction of travel is clear: regulators expect sustained improvement.

Businesses that invest now in robust financial reporting frameworks, independent review and audit readiness can reduce remediation costs and strengthen market confidence. Those that wait may face greater intervention risk and board-level attention. Action should be proportionate but visible, with clear ownership, escalation paths and measurable remediation plans.