FRC publishes scope of Audit Quality Reviews for 2016/17

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30 Mar, 2016

The Financial Reporting Council (FRC) has published the scope of independent inspections of individual entities to be undertaken by its Audit Quality Review (AQR) team in 2016/17.

The Audit Quality Review (AQR) team monitors the quality of the audit work of those UK audit firms that audit public interest and large AIM entities.  The overall objective of their work is “to monitor and promote continuous improvements in audit quality in the UK”.

All UK audit firms that undertake public interest and large AIM entity audits are subject to AQR inspections in respect of this audit work. The professional bodies have the responsibility for monitoring all other audit work. The frequency of AQR inspections varies with larger firms inspected annually while other firms are generally inspected once every three years.

Reviews are performed on a risk-based approach and take into account “priority sectors” which, the FRC wishes to focus on.  It has indicated that these priority sectors will be the extractive industries, companies servicing extractive companies, companies servicing the public sector and media businesses for the 2016/17 financial year.

Further information on the work of the AQR team and the scope of the AQR reviews for 2016/17 can be obtained from the FRC website.

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