Governance in brief — BIS and the FRC consult on options for UK implementation of the EU Audit Directive and Regulation
This publication from Deloitte discusses the Department for Business Innovation and Skills (BIS) and the Financial Reporting Council's (FRC) consultation papers on audit reform. These discuss options for UK implementation of the EU Audit Directive and Audit Regulation and also build on the work of the Competition and Markets Authority (CMA).
The FRC consultation document identifies and explains the range of positions the FRC is considering with respect to the Member State options in the Directive and Regulation, should it be granted the delegated power to exercise them, and seeks stakeholder views about them.
Amongst other things, the papers confirm that the UK will take the option to extend the mandatory auditor rotation period to 20 years provided that there is a tender at the ten year point. In addition, a range of potential options for restrictions on the provision of non-audit services by auditors are set out including having a ‘white list’ of permitted services with everything else banned or a ‘black list’ of prohibited services.
