stakeholders. In the event that the draft bill does bring any surprises, there is likely to be a significant volume of consultation responses from within the industry and beyond, given that this is such an important and topical area.
In the interim, the FRC has already taken forward various measures to seek to improve audit quality and promote competition, and will no doubt continue to do so, not least given that it has recruited heavily over the last few years, in anticipation of the ARGA reforms, and so now has significant resources at its disposal. For example, the FRC has now taken over PIE auditor registration from the professional bodies, as well as making (admittedly watered-down) amendments to the UK Corporate Governance Code. Further, the FRC has been taking steps towards encouraging greater competition in the PIE audit market, for example in creating a “regulatory scalebox” and support systems to assist smaller PIE audit firms looking to expand their market share, and new firms looking to break into this area.
As has been widely reported, the FRC has, over the last few years, imposed record fines on accounting firms for poor quality audit work, and it appears keen to use its existing remit and powers to their full effect. Once the proposed reforms are finally put in place, we expect to see ARGA making full use of its expanded remit and powers.
