Whilst the Government set out its commitment to reform with the draft bill announced, uncertainty remains as to the detail and timing of the bill. Some commentators have noted that it is highly unlikely for the bill to feature within the 2022/23 Parliamentary sessions but its trailing will enable some consultation and pre-legislative scrutiny to commence.

The main elements of the Draft Audit Reform Bill were described in the supporting papers as being:

• Establishing a new statutory regulator, the Audit, Reporting and Governance Authority, that will protect and promote the interests of investors, other users of corporate reporting and the wider public interest.
• Providing new measures to open up the market, including a new approach of managed shared audit in which challenger firms undertake a share of the work on large-scale audits. This will improve the quality and usefulness of audit; and boost resilience, competition, and choice in the audit market.
• Bringing the largest private companies in scope of regulation in the definition of ‘public interest entities’, recognising the public interest in companies of this size.
• Giving the new regulator effective powers to enforce directors’ financial reporting duties, to supervise corporate reporting, and to oversee and regulate the accountancy and actuarial professions.
• Reforming the regulation of Insolvency Practitioners to give greater confidence to creditors and strengthening corporate governance of firms in or approaching insolvency so that ‘asset stripping’ can be more effectively tackled.

As per the documentation issued on 10th May, the Government’s Response to the consultation on the BEIS White Paper is expected to be published shortly. 

For the full text of the Queen’s Speech and the supporting narrative click here.