The Financial Reporting Council (FRC) has issued a consultation proposing important changes to the UK’s Ethical and Auditing Standards. The FRC proposes to set more stringent ethical rules for auditors, in response to findings from recent audit enforcement cases and from audit inspections. In response to feedback from investors, the FRC also proposes to enhance the quality and content of auditor’s reports in order to improve transparency about what is found in the course of an audit.
ACCA welcomes the opportunity to comment on the proposals issued by the FRC. We are pleased to note that the proposed revisions follow the work done by IESBA in its restructured code that came into effect in June 2019.
We are also supportive of the FRC’s initiatives in responding to the changing expectations of users of financial information following the recent audit and corporate failures, the decline in audit quality as well as the other changes impacting the UK audit landscape recognised in the consultation paper. However, we do have some detailed concerns with some of the proposed changes and these are reflected in our response.
To read in full, please download the consultation response.