On 11 March 2019, the Business Secretary, Greg Clark, announced that the Financial Reporting Council (“FRC”), a UK regulator responsible for auditors, accountants and actuaries, will be abolished. The FRC will be replaced by a new regulator, the Audit, Reporting and Governance Authority.
The decision follows an independent review of the FRC completed in December 2018, which recommended that the FRC be replaced by a new regulator with enhanced statutory powers. The Government has accepted 48 of the review’s 83 recommendations and launched a consultation (closing on 11 June 2019).
The new regulator’s proposed enhanced powers include extending enforcement powers in relation to company directors, skilled person reviews (which may be made public by the regulator) and powers to require ‘rapid explanations’ from companies about regulatory concerns.