Financial Reporting Council Reform
Open date: 18 Oct 2011
Closing date: 10 Jan 2012
Response date: 27 Mar 2012
A consultation paper seeking views on proposed reforms to the structure of the Financial Reporting Council has been published. Responses due by 10 January 2012.
BIS and FRC consulted jointly on proposals to reform the FRC. The proposals were designed to clarify the FRC’s scope, streamline its governance and structure, and give it greater independence from the accountancy profession and a proportionate range of sanctions against poor quality auditing.
The response to the consultation helped the Department and the FRC refine the proposals. In particular the proposals have been amended to enhance the status of the expert groups that will advise the FRC Board on accounting, auditing and actuarial issues and to make clear the procedural safeguards that will be put in place as part of the FRC’s monitoring and enforcement work.
The Government intends, subject to Parliamentary approval, to bring forward secondary legislation for changes to come into force from Monday, 2nd July 2012.
The joint Government and FRC response was published on 27th March 2012 (please see link below).
The FRC is already well-regarded in the UK, the EU and internationally, but we believe by tightening the focus of its activities and reforming its structural framework that it could be even more effective, increasing still further the contribution it makes to supporting the UK’s business interests. This consultation document seeks views on a set of reforms designed to build on the FRC’s strengths as well as tackle the underlying issues that currently inhibit its effectiveness. Reform is needed to:
- reinforce the FRC’s independence from those it regulates;
- improve its efficiency and effectiveness; and
- rationalise and minimise the regulatory burdens on market participants.
It is not intended that reform should introduce further regulatory processes which impact significantly on business. However, to achieve our aims some proposed reforms will require changes to the legislative framework. We are committed to reducing the cost to business associated with FRC regulation and will consider carefully any opportunities for cost reduction identified through responses to this consultation.
Download the consultation
Download the government response