A beefed-up UK financial regulator will require a huge increase in budget on that which it currently receives, according to the chairman of the Financial Reporting Council.
Sir Bryan Nicholson, who will head up the new FRC, incorporating the soon to be defunct Accountancy Foundation, warned the ICAEW at its annual conference on Tuesday that he expected the funding of the expanded body to be twice that of the current FRC and foundation’s budgets combined.
The new FRC will be funded in equal parts by the government, private business and the accountancy profession.
Each sector could be asked to provide up to £4m a year to help run the council, however Sir Bryan said that the ‘total financial support for the costs of regulation from the profession should not change that much, taking into account the fact that alone they have already been meeting all the costs of the foundation in addition to their share of support for the FRC’s budget’.
The body will continue to house the UK Accounting Standards Board and the Financial Reporting Review Panel, as well as two boards from the foundation – the Auditing Practices Board and the Accountancy Investigation and Discipline Board – and the new Professional Oversight Board for Accountancy.
Council meetings will now occur four times a year, replacing the current biannual events. In addition, a newly created management board, chaired by Sir Bryan, comprising of the five board chairmen and directors, will meet monthly.
It will officially assume the role of accountancy watchdog early next year, but Sir Bryan expects the FRC to take on many of the responsibilities before that.
Sir Bryan admitted there was still much work to do including ‘recruiting for a significant number of new positions’ and looking at ways to increase the transparency and accountability of the council’s activities.
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