FRC publishes minimum standard for audit committees

Posted on May 28, 2023 by Editor

The Financial Reporting Council (FRC) has released the Audit Committees and the External Audit: Minimum Standard, designed to enhance audit quality and reinforce public trust in the financial reporting process. The standard provides clear expectations and guidelines for audit committees within the FTSE350, supporting the delivery of high-quality audits.

Developed in response to the government’s consultation on Restoring Trust in Audit and Corporate Governance, the FRC’s standard aligns with the intention to grant statutory powers to ARGA {Ed — that’s the soon to be created Audit, Reporting and Governance Authority} for mandating minimum standards for audit committees in relation to external audits. Prior to those new powers arriving, the FRC has made the standard available on a voluntary basis for audit committees. This allows them to familiarise themselves with the requirements and enhance their practices before mandatory compliance, expected to be introduced through legislation.

Mark Babington, Executive Director of Regulatory Standards at the FRC, emphasised the importance of the standard in strengthening the audit market and restoring trust in the profession. By setting clear expectations and guidelines, the FRC aims to support high-quality audits and reinforce public confidence in the financial reporting process.

Read more here.

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