Thursday, 16 June 2011

UK: the role of audit and market concentration - Government response to Economic Affairs Committee report

The chairman of the House of Lords Economic Affairs Committee, Lord MacGregor of Pulham Market, has said that the Government’s response to the Committee's recent report on audit market concentration and the auditor's role is "not good enough": see here.

There is much in the Government's response - available here - in respect of its current position on various governance and financial reporting matters. For example, the Government rejects imposing a ban on audit firms providing non-audit services to their audit clients, because it believes that the APBs Ethical Standards are sufficient to ensure auditor independence. It notes, nevertheless, that the it would be desirable for company audits to be put out to tender more frequently than is currently the case. The response also states that BIS and the FRC are expected to seek views on possible reforms to the FRC's powers later this year.

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