Will the audit regulator toughen up?

Intense pressure on the audit regulator, the FRC, has resulted in a spate of multimillion pound fines for audit firms over audit misconduct, but there are warning signs that the latest Corporate Governance Code will raise the bar before the ARGA comes into effect, argues Mark Wearden FCCA

The view of the Financial Reporting Council (FRC) portrayed in the 2018 Kingman report into the future of audit was of a dog which was able to bark but was significantly lacking in its ability to actually bite.

At least part of the rationale for the transformation of the FRC into a proposed statutory body to be called the Audit, Reporting and Governance Authority (ARGA) was to give the regulatory dog some teeth, although we are still waiting for the government to take action on this.

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