12 June 2013

FRC: Consultation paper on sanctions guidance

One of the FRC’s key goals has been to enhance auditor performance by instituting a new regime for the independent sanction of poor audit work. This draft paper follows a consultation in December 2012 on the proposed Auditor Regulatory Sanctions Procedure which set out how the FRC’s new regulatory regime will operate.

The FRC recognises that such sanctions should be based on clear guidance to promote consistency and fairness. The Guidance for consultation sets out an approach for Committees and Tribunals when determining the appropriate sanctions that is flexible and allows for the exercise of discretion. The Sanctions Guidance proposes a principles based rather than a tariff based approach.
 
FRC CEO Stephen Haddrill said: “In publishing for consultation both the Sanctions Procedure, and this following Guidance, the FRC is one step closer to enhancing the value and impact of its audit monitoring activities. By sanctioning poor quality audit work we can further encourage firms and individuals to produce top quality audits and enhance trust in the audit profession. This new Guidance sets out a clear approach for Committees and Tribunals that ensures transparency and consistency in administering sanctions.”

Press release

Consultation paper

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