The UK’s chief financial regulator is seeking bold new powers to fine, censure or disqualify audit firms.
A discussion paper released today proposes greater punitive measures for the Financial Services Authority (FSA) following a scathing report which questions auditor’s independence in the lead up to the crisis.
The report raises concerns auditors failed to adequately scrutinise management bias displaying “a worrying lack of scepticism”.
The FSA said it now needs more “enforcement powers to enable it to make a fully calibrated response to the level of regulatory concern in any given case”.
It said it now wants to meet with auditors several times before year ends to discuss potential issues. At present FSA officials meet auditors only once a year.
The body also wants direct access to audit committees, within listed companies, to discuss audit issues.
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