FRC announces plans to create a “more forceful regulator”.

6 February 2020

Julie Matheson, Partner, in our Regulatory team has been quoted in The Telegraph and City A.M. regarding the Financial Reporting Council's announcement of their plans to create a “more forceful regulator”.

Julie commented in The Telegraph:

“The FRC’s draft strategy for 2020 demonstrates its drive to bolster its regulatory bite, on the background of the recommendations made in the Kingman report.  The FRC has been criticised in the past for the speed of its investigations - employing 100 more staff is a significant step in seeking to address this. The proposed reorganisation of the FRC to encompass separate ‘Supervision’ and ‘Enforcement’ divisions is akin to the FCA’s approach and will naturally lead to audit firms being further subject to the FRC spotlight.  The number of yearly Audit Quality Reviews is to increase, which will no doubt lead to more enforcement action where failures are identified.  That spotlight will also widen to place more focus on ‘challenger firms’ to the Big 4.  This may cause such challenger firms to look again at whether they want to enter this market.  The FRC’s proposed more intensive oversight should give comfort to the public, however, company boards and audit firms may find the increased scrutiny to be an unwelcome development.”

The article was first published in The Telegraph on 5 February 2020. You can read the full article by clicking here.

Julie's comments were also published in City A.M. which you can read by clicking here.

About the author

Julie Matheson is a Partner in the Regulatory team, specialising in defending professionals in the financial and legal fields.  She has particular expertise in defending accountants and accountancy firms in regulatory proceedings brought by the FRC, ICAEW and ACCA.  She also regularly provides advice on FCA conduct issues, particularly under the Senior Managers and Certification Schemes.

 

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