Ms Aisling Kennedy:

I welcome the opportunity to appear before the committee to discuss the approach I will take to my role as chairperson of the Irish Auditing and Accounting Supervisory Authority, my views about the future contribution of IAASA, and my strategic priorities for the role.

I was honoured to be appointed by the Minister, Deputy Calleary, then Minister of State with responsibility for trade promotion, digital and company regulation, as chairperson of IAASA on 17 December 2024. I had previously served as a member of the board of IAASA since December 2020. The functions of IAASA, as an independent body responsible for supervising the regulatory functions of the prescribed accountancy bodies, monitoring the financial and sustainability statements of listed entities for compliance with relevant standards, inspecting the audits and sustainability assurance engagements of public interest entities and investigating breaches of standards, are essential to maintaining public confidence in the integrity and quality of auditing and accounting. These functions support IAASA's mission, which is to uphold quality corporate reporting and an accountable profession.

I will begin by providing the committee with a brief overview of my background and experience. I am an actuary by profession with more than 40 years' experience in the financial services industry. I have undertaken a diverse range of management and consulting roles in Ireland and the UK. I served for a number of years as director of professional affairs for the Society of Actuaries in Ireland, during which time I led the development of actuarial professional practice standards and the certification of statutory actuarial roles. I am now an independent non-executive director of four insurance companies, one of which I chair, and a fund services company. I chair the audit committees of three of these companies. In the UK, I serve on the board of a FTSE 250 company and chair its sustainability committee. My experience on the IAASA board since 2020, and on the boards of several regulated entities, has provided me with a strong grounding in regulatory processes, reporting requirements and accountability structures. As a member and past steward of a trusted professional body, I believe in the importance of effective oversight and accountability in ensuring high professional standards.

I will continue by sharing the approach I will bring to the role of chair of IAASA. In so doing, I wish to acknowledge the work of my predecessor, Mr. Martin Sisk, the strong leadership team in place at IAASA, led by chief executive Kevin Prendergast, and the collective experience and commitment of my fellow board members, with whom I have served over the past four years. IAASA is a small organisation, albeit with deep subject matter expertise, having just 36 employees organised across seven teams, most of whom I am glad to say I have had the opportunity to meet in person.

In 2023, IAASA canvassed the views of its stakeholders as part of its commitment to continuous improvement. The results showed that IAASA enjoys a strong reputation. Its decision-making approaches were well regarded and seen to reflect its values, including its independence, fairness, robust actions and consistent decision-making. Key strengths highlighted were IAASA’s independence, staff expertise, accessibility and clear values. IAASA is viewed as effective in achieving its mission and key strategies.

As incoming chair, I am mindful that this is an organisation that is on a strong and steady course. My role will be to lead the board as it supports and challenges the leadership team to maintain that course, as well as addressing new and emerging issues as they arise. My focus will be on supporting continued excellence, adapting to new demands and ensuring that IAASA remains firmly anchored in the public interest. I will endeavour to support a culture of openness, accountability and balanced decision-making. As the regulatory landscape within which IAASA operates continues to evolve, I will listen to those we regulate, to fellow regulators and policymakers and, importantly, to the public, whose interests IAASA serves.

Turning to the future contribution of IAASA, in brief, this will be to continue its public interest mandate by enhancing audit supervision, implementing the oversight of sustainability assurance, influencing the development of international standards and regulation, promoting sector excellence and building internal capacity in order to ensure trust in Ireland’s corporate reporting framework into the future.

IAASA is preparing its three-year work programme for the period 2026 to 2028, which will be designed across three key strands, namely, delivering effective regulation, promoting high standards and enhancing organisational capability. While the new programme will in one sense represent a steady evolution of the current 2023–25 programme, in another sense IAASA’s role has expanded significantly. With the implementation of the corporate sustainability reporting directive, CSRD, notwithstanding the recent stop-the-clock measures, come significant new responsibilities for IAASA in inspecting and regulating sustainability assurance engagements. The organisation has made a significant investment in preparing for the implementation of CSRD. Its inspection of a selection of wave 1 sustainability reporting will represent a milestone.

The environment in which IAASA operates continues to change rapidly. The demands on financial reporting and audit are growing in complexity, expectation and public scrutiny. The impact of new technology, particularly artificial intelligence tools, represents both a challenge and an opportunity for effective accounting and audit regulation. The changing landscape of the accounting profession, its education programmes and the structure and ownership of accounting and audit firms will present evolving issues for IAASA and its fellow audit regulators in Europe and beyond.

I hope IAASA will continue to have a significant role in shaping audit and accounting standards in Europe and globally through its membership of the Committee of European Audit Oversight Bodies, CEAOB, the International Forum of Independent Audit Regulators, IFIAR, and, over the next two years in particular, through the appointment of its chief executive, Kevin Prendergast, as chair of IFIAR.

As chair, my foremost priority is to ensure IAASA remains a strong, independent regulator that acts in the public interest and fulfils its vision of public trust and confidence in quality auditing and accounting. The quality of statutory reporting and audit is fundamental to how our economy functions and how public confidence is sustained. IAASA’s role in oversight and enforcement will continue to be essential in that regard.

It is also a priority for me that we optimise the effectiveness of the board, leveraging the diverse perspectives and capabilities of its individual members effectively to support and challenge the leadership team. The board includes representatives from the Central Bank, the Corporate Enforcement Authority, the Revenue Commissioners, Euronext and the accountancy profession, providing a rich blend of technical expertise, regulatory insights and governance experience to pursue a shared objective that IAASA remains a high-performing organisation.

My third priority is that we continue to build and develop IAASA’s future capability in order that it is well positioned to face future challenges across the dimensions of people, systems and governance. We will continue to invest in strengthening the resilience and agility of IAASA’s work force in order that it is equipped to respond effectively to its dynamic environment. We will engage with and adapt to legal, market and technological shifts to ensure that IAASA remains agile, resilient and responsive to new developments. The board will fully support these objectives, ensuring they are pursued within a robust and forward-looking governance framework.

I thank the committee for the opportunity to present this submission and look forward to addressing any questions members may have.