The FRC has today published the regulations for the upcoming PIE Auditor Register, following the Government’s response to the consultation on Restoring trust in audit and corporate governance.
From 5 December 2022 all audit firms and responsible individuals who undertake statutory audit work for Public Interest Entities (PIEs) will need to be registered.
Audit firms currently auditing PIEs will need to apply and be approved to be included on the PIE Audit Register to prevent any disruption to their work. There will be a transition period from 5 September to 4 December 2022 for existing audit firms of PIEs to submit transitional applications.
The Kingman Review in 2018 found that the FRC had insufficient powers to address systemic issues at the firms, relying on the registration powers of the Recognised Supervisory Bodies. The creation of the PIE Auditor Register was also a key action set out in the Government Response in May and is one of the first projects to be implemented.
Directly registering audit firms and individuals signing PIE audit reports will bolster the FRC’s supervisory toolkit and enable it to become increasingly assertive in holding audit firms to account for the delivery of high-quality audit.
The FRC’s Executive Director of Supervision, Sarah Rapson said, “The new Regulations will mean the FRC can act decisively when it identifies systemic issues in an audit firm, allowing us to impose conditions, suspensions and, in the most serious cases, remove registration.“This was one of the key recommendations of the Kingman Review and it is an essential part of the supervisory toolkit.”
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By GlobalDataFollowing a consultation that ended in May 2022, the FRC is today publishing the PIE Auditor Registration Regulations, guidance on transitional applications and the feedback statement on the consultation.
View the PIE Auditor Registration Regulations
View the Transitional GuidanceView the Consultation Feedback Statement