Mid-tier firm BDO picks up Nicholls audit whileAssociated British Foods, owners of the Primark brand, put their audit business out to tender after 79 years with KPMG. Meantime, MoD given a roasting over accounts for fifth year in a row and FRC issues warning to companies not to disclose audit inspection grades
The Financial Reporting Council (FRC) has warned audit committees not to disclose the inspection grade given to a company that has been inspected by the FRC’s Audit Quality Review, contrary to the recommendation of the Competition and Markets Authority’s (CMA) after its statutory investigation of the audit market.
In a move to ‘improve the transparency of its AQR findings’, the FRC issued the warnings, arguing that its grading system is meant to help internal teams understand the significance of issues identified and their implications.
‘The grades are not intended to provide an assessment of the reliability of the financial statements as a whole or the audit opinion, and we are concerned that the publication of such a “single figure” could mislead and distract attention from the key issues identified by the [audit] committee,’ the FRC said.
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