Flint was part of the original team that developed the guidance on internal control and risk management in 1999. Developments in the UK and financial scandals abroad persuaded the FRC that the guidance may need updating to bring it in line with the current climate on corporate governance.
‘The Turnbull guidance continues to provide a good framework for boards to ensure they have a sound system of internal control,’ said FRC chairman Sir Bryan Nicholson. ‘There have been developments in the UK and internationally since it was published, and it is now an appropriate time to review the guidance and make sure that it remains relevant.’
Other members of the review team include John Coombe, chief financial officer at GlaxoSmithKline, Diageo chief executive Paul Walsh, and Michael Hughes, UK chairman of audit at KPMG. The review will commence later in the year and it is intended that any changes made to the guidance will come into effect from the beginning of 2006.
‘The original objective of the guidance was to help companies manage risk effectively as part of their fulfilment of their business objectives and in recognition of their duty to safeguard shareholders’ investment and the company’s assets,’ said Flint. ‘That objective is as important today as it has ever been; indeed perhaps more so as there is increased public interest in demonstrating that public investment markets deserve the trust of those who allocate savings to investing in such markets.’
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