A new audit body with stronger legal powers is to replace the Financial Reporting Council (FRC), and will take its Carillion investigation.
Business secretary Greg Clark has announced that the new enhanced regulator will take over the role of the FRC following an independent review led by John Kingman.
The Audit, Reporting & Governance Authority (Arga) will be a statutory body. A government spokesperson also confirmed that Arga will also be given the power to “carry out more comprehensive, visible reviews for greater transparency”.
A FRC spokesperson told New Civil Engineer that all on-going investigations will be taken over by Arga following a consultation into the change. It comes after an independent review of the FRC called for greater transparency and enhanced enforcement activity. In total 48 recommendations from the report are being taken forward.
FRC chair Sir Win Bischoff said: “We welcome this consultation and hope that a diverse range of organisations and individuals respond to it. In line with the consultation document we believe the speedy implementation of the recommendations can help increase public confidence in audit in the UK. We will move forward to implement the agreed proposals as soon as possible.”
Kingman added: “As I set out in my review, we need a new audit regulator with a clear and precise sense of purpose, and I am pleased that the government shares that vision,” he said. “I look forward to continuing to work closely with the secretary of state as the Audit, Reporting and Governance Authority is established.”
A consultation on the swap from the FRC to the ARGA will run until the 11 June this year.
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