The Financial Reporting Review Panel could remain in existence and continue to police company accounts, but with the help of expertise from the Financial Services Authority, sources close to the Department of Trade & Industry insisted this week.
The Coordinating Group on Audit and Accountancy is due to report next week but controversy has been raging over whether company accounts would continue to be investigated by the FRRP or would be taken over by City watchdog, the FSA.
Last week the FSA said it had ‘a role to play’ with reports in the press claiming the FRRP would disappear. FSA efforts to seize the initiative raised the spectre of inter-departmental conflict within government because the regulator comes under the Treasury while the FRRP is overseen by the DTI.
But sources close to the coordinating group believe the FRRP has impressed ministers and could retain its role but with fresh resources. The FSA would help with expertise on risk assessment and by pinpointing companies in danger of being non-compliant with accounting standards. Under this model the FRRP would continue to be the investigating body.
‘The FRRP has done a bloody good job in dealing with compliance,’ said the source.