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The Financial Reporting Council (FRC) has yesterday launched a consultation on proposals for the Audit Enforcement Procedure, developed to implement its forthcoming responsibility for audit enforcement.

The EU Audit Regulation and Directive (ARD) comes into force on 17 June this year. As the Competent Authority for audit regulation the FRC is consulting on an enforcement procedure designed to respond to the new audit regulatory framework and to assist with the promotion of high quality audit. The procedure will apply to the investigation and sanctioning of breaches of the various requirements of the statutory auditors of Public Interest Entities (PIEs) and any other cases retained by the FRC. It is intended that the FRC will delegate the vast majority of investigation and sanctioning of non-PIE cases to the professional bodies.

The proposed new Audit Enforcement Procedure will, in relation to statutory audit cases, replace the FRC’s existing sanctions procedure and disciplinary tribunal scheme and will provide a single, streamlined procedure for audit enforcement.

Responses to the FRC’s consultation should be sent by email to consultation@frc.org.uk by 4 May 2016.

The FRC will arrange other opportunities to gather feedback on the proposals.

Related Resources

Consultation: Enhancing Confidence in Audit - The FRC's Audit Enforcement Procedure