Incorporation of the 8th Directive into UK law.ppt

Incorporation of the 8th Directive into UK law Regulation of Companies and their Auditors the New UK Regulatory Framework – the ‘Competent Authorities’ Given birth by the Companies (Audit, etc) Act 2004 R?le and objectives of the oversight body, the Financial Reporting Council (FRC) R?le of each subsidiary FRC body R?le of Recognised Supervisory Bodies (RSBs) Monitoring audit quality Reporting Background to the changes in the UK regulatory regime The organic growth of regulatory régimes A Government report reviewing the UK regulatory regime revealed no evidence of serious flaws, BUT there were concerns over the independence of audit firms from their clients Overall regulatory framework Professional bodies like ICAS continue to have the primary responsibility for the supervision of members’ and member firms’ conduct RSBs’ regulatory, licensing and disciplinary systems constantly reviewed FRC to be the new unified independent regulator with a remit extended to include: A more proactive Financial Reporting Review Panel An extended Auditing Practices Board An independent investigation and discipline function An independent oversight function An Accounting Standards Board subsumed under the FRC The Financial Reporting Council The FRC’s aim is to promote confidence in corporate reporting and governance, by ensuring that RSBs enforce their own standards and by de-registering RSBs that fail to ‘arms-length’ between FRC and RSBs The funding of the FRC and its subsidiary bodies is one-third to Government, one-third to business and one-third to the accountancy (not merely auditing) profession Financial Reporting Review Panel Ensures financial information provided by companies complies with relevant reporting requirements Now proactive (makes about 300 checks p.a.) Risk-based approach Accountancy Investigation and Discipline Board Independent investigation and disciplinary body for accountants in the UK All members, not just auditors Compliant wit