Mario Christodoulou, Accountancy Age, Wednesday 13 October 2010 at 16:14:00

FRC wants more power to sanction auditors

The UK?s reporting regulator wants greater power to sanction and disciplineaudit firms - including the introduction of an added licence for auditors oflarge companies.

The Financial Reporting Council is pushing for ?a wider range of sanctions toaddress shortcomings in audit quality? according to its submission to aHouseof Lords inquiry.

?We believe the FRC should have responsibility for the licensing of auditorsof public interest entities ? a task that should be undertaken in addition tothe general licensing of auditors within the profession itself,? the FRC said inits submission.

Accounting firms are regulated, to a large extent, by professional accountingbodies, which have the power to hold hearings, de-register and ban bothindividuals and firms from practicing audit.

The FRC only has the power to investigate cases referred on by theprofessional accounting bodies ? ICAEW, ICAS, ACCA and CIPFA ? or cases whichare in the public realm. The body?s disciplinary arm, the Accountancy andActuarial Discipline Board, has in the past tried to convince the accountingbodies to allow it to begin its own independent investigations, but has so farfailed to garner a consensus.

Further reading:

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