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MPs slam slow process for audit overhaul

23rd July 2020

The Government has been criticised for dragging its heels over revamping the audit system.

The Business, Energy and Industrial Strategy (BEIS) select committee reiterated calls for the Financial Reporting Council (FRC) to be replaced.

In October 2019, the BEIS suggested replacing the FRC with a more powerful regulator - the Audit, Reporting and Governance Authority (ARGA).

Ten months on and on the eve of summer recess, ministers stated the ARGA would be brought in "as soon as parliamentary time allows".

Darren Jones, chair of the BEIS committee, said:

"At a time when businesses are facing tough trading conditions and when their balance sheets are under significant pressure, it's important investors and other stakeholders can have confidence in audits.

"While the Government has a series of priorities at the moment, far more urgency should be shown to help drive through the reforms needed on audit and on corporate governance."

Last year, the BEIS committee suggested a full, structural break-up of the audit and non-audit services offered by the Big Four accountancy firms.

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