Another Slice of Pie
Wondering what to expect when it’s your turn for an FRC Audit Quality Review visit? Julie Long explains.
Some entities are defined as Public Interest Entities (PIEs) by the EU Audit Regulation and Directive (ARD) and from 17 June this imposes new requirements on PIEs and their auditors.
Any firm that audits at least one PIE must now be monitored directly by the Competent Authority: in the UK this is the FRC, which is prevented from delegating the monitoring of PIE audits and their auditors to recognised supervisory bodies such as ICAEW – and its Quality Assurance Department (QAD).
Although some firms are completely removed from FRC Audit Quality Review (AQR) team monitoring by the ARD, it brings some entities (such as unlisted insurers) and their audit firms into the scope of AQR monitoring for the first time.
In response to this, the FRC has removed other major audits, such as large private companies, pension schemes and charities, from its scope and these will now be monitored by QAD. As a result, FRC audit quality monitoring will expand from nine firms to approximately 50.
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