FRC issues revised ISAs and Corporate Governance Code

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17 Jun, 2016

The Financial Reporting Council (FRC) has issued the 2016 UK Corporate Governance Code ("the Code"), the revised Guidance on Audit Committees, the Ethical Standards 2016 and revised International Standards on Auditing (UK).

In May 2016, the FRC issued "Final drafts" of all of these documents, which are necessary to fulfil its obligations regarding the implementation of the EU Audit Regulation and Directive, together with parts of the Competition & Markets Authority’s (CMA’s) final Order.the EU Audit Regulation and Directive, together with parts of the Competition & Markets Authority’s (CMA’s) final Order. At that stage they were unable to publish completely final versions as these changes also rely on the introduction of The Statutory Auditors and Third Country Auditors Regulations 2016, which are expected to be published imminently.

As expected, there are only minor differences between the "final draft" and "final" versions of these documents, the most significant being that the ISAs and Ethical Standards published by the FRC will now apply only in the UK and not also in Ireland, as previous versions have done.

Stephen Haddrill, Chief Executive of the FRC, commented that:

New UK auditing and ethical standards published today provide auditors with a comprehensive basis to comply with their updated obligations. The changes to the ethical standard set out the principles that underpin high quality, independent audit and, particularly for the audits of Public Interest Entities, strengthen auditor independence by prohibiting or restricting a range of engagements that could result in a conflict of interest. Reflecting the FRC’s commitment to proportionate regulation, the revised standards contain some flexibility to allow an auditor to provide some additional assistance to smaller and medium-sized entities

Our previous UK Accounting Plus news article on the publication of the "final drafts" has more detail on the changes from previously effective versions of these documents. A list of the amendments made to the "final drafts" can be obtained from the FRC website, as can their press release announcing these changes. Final versions of all of the documents can be obtained from the FRC's publications pages.

For more detail on audit reform, visit our UK Accounting Plus project page.

 

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the EU Audit Regulation and Directive, together with parts of the Competition & Markets Authority’s (CMA’s) final Orderthe EU Audit Regulation and Directive, together with parts of the Competition & Markets Authority’s (CMA’s) final Order.

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