Financial Reporting Council

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The Financial Reporting Council is a semi-public independent standards body for corporate governance in the United Kingdom and Ireland . He is particularly known for the publication of the UK Corporate Governance Code , and requirements for reporting and the work of auditors and actuaries have been formulated. In March 2019 it was announced that the FRC will be dissolved and replaced by a new authority, the Audit, Reporting and Governance Authority .

background

The Financial Reporting Council, founded in 1990, is privately organized as a private company limited by guarantee . According to the statutes of the organization, the FRC has the particular task of promoting the correctness of financial reporting and supporting its qualitative further development. For this purpose, the organization has set up various councils that deal with the individual subject areas.

organization structure

At the end of 2011, a consultation process on the reform of the FRC was launched, which was completed in January 2012. The final report was published in March 2012. With this reform, the structure of the organization was changed.

The FRC board has been supported by three committees since the reform. In addition to the Executive Committee , these are the Codes and Standards Committee and the Conduct Committee . The latter two are also divided into the Accounting Council , Actuarial Council and Audit and Assurance Council or Monitoring Committee and Case Management Committee . These essentially develop the standards that are issued by the FRC Board.

tasks

Accounting Council

The Council is responsible for developing accounting and financial reporting standards in the UK. For this purpose, practitioners, users and academics are included in the consultations. The Council is also responsible for participating in consultations on international standards for accounting and financial reporting.

The council is made up of the chairman and up to eleven other members, at least half of whom are practitioners in accordance with the statutes. The members are determined by the Codes and Standards Committee .

Actuarial Council

Since 2005, the Financial Reporting Council has been the independent body responsible for overseeing actuaries in the UK and issuing related technical standards. The council was set up for this purpose. This is made up of the chairman and up to eleven other members, at least half of whom are practitioners in accordance with the statutes. The members are determined by the Codes and Standards Committee .

Audit and Assurance Council

The Council is responsible for matters relating to auditing and other auditing in the UK. For this purpose, practitioners, users and academics are included in the consultations. The Council is also responsible for participating in consultations on international standards for audit topics.

The council is made up of the chairman and up to eleven other members, at least half of whom are practitioners in accordance with the statutes. The members are determined by the Codes and Standards Committee .

Monitoring Committee

The Council is responsible for taking measures to monitor compliance with the standards issued by the FRC. This applies in particular to compliance with the legal requirements for accounting for public and larger private companies as well as requirements for the corresponding auditing.

Case Management Committee

The council decides on disciplinary action in case of non-compliance with the standards set by the FRC.

Kingman Review and Dissolution

In the wake of some high-profile cases of irregularities in large corporations, the UK government ordered an investigation into the effectiveness of the FRC. The investigation report criticized the lack of clout of the FRC and suggested a new authority to found, which is directly subordinate to the parliament. In March 2019, the government announced that it would follow the report that same year.

Web links

Individual evidence

  1. ↑ gov.uk: "PROPOSALS TO REFORM THE FINANCIAL REPORTING COUNCIL - A joint Government and FRC response"
  2. ^ UK audit watchdog to be scrapped . March 11, 2019 ( bbc.com [accessed March 17, 2019]).