Government gives green light to FRC reforms

THE GOVERNMENT has given the Financial Reporting Committee the thumbs up to continue with its proposed reforms.

Following a consultation the accounting watchdog proposed reducing its seven operating arms down to just two. However, the organisation was awaiting government approval before continuing with its reforms.

The FRC currently has several operating bodies including the Accountancy Actuarial Disciplinary Board (AADB), Audit Inspection Unit (AIU), Financial Reporting Review Panel (FRRP), Professional Oversight Board (POB), Auditing Practices Board (APB), and Accounting Standards Board (ASB).

Business minister Norman Lamb said: “The FRC is already well-regarded both in the UK and internationally for the crucial role it plays in supporting high quality and transparent financial reporting. But, by tightening its focus and streamlining its governance and structure, we believe the FRC can be even more effective.

“Government and the FRC reflected on all responses to the consultation and held further discussions with industry and investors on the detail of the proposals. The FRC will continue this dialogue with stakeholders as the changes are implemented.”

Codes and Standards will effectively succeed the ASB, APB and the Board for Actuarial Standards (BAS). It will be supported by three councils that will advise on accounting, audit & assurance and actuarial matters with these councils chaired by former PwC senior partner Roger Marshall; former Ernst & Young chairman Nick Land (pictured); and for pension regulator and FSA employee Olivia Dickson.

Jim Sutcliffe, currently chairman of BAS, will become chairman of the codes and standards.

The Conduct Division of the FRC will cover supervisory and disciplinary matters and takes over from the FRRP, POB, AIU and the AADB. It will be chaired by Richard Fleck, the current chair of the Auditing Practices Board which he will relinquish to Nick Land.

Paul George, current director of auditing at the FRC, has been appointed as executive director of conduct in the new structure. George will have overall responsibility for supervisory and disciplinary matters, including the work currently undertaken by the FRRP, the POB and the AIU and the AADB.

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