New Audit Practice Rules Unveiled

Thu, 17 Feb 2011

The Financial Services Authority (FSA) and the Bank of England have unveiled a new set of guidelines aimed at making accountancy firms more transparent.

Under the new proposals, accountancy firms would be legally obliged to share more information about the companies they audit . Regulators of large financial companies would also be required to have more meetings with their auditors .

The FSA argue that these new regulations would "enhance their ability to scrutinise specific accounting practices and related judgments in order to understand fully their implications and to highlight emerging problems".

Richard Thorpe, the FSA’s auditing and accounting sector leader, added: "The FSA and its successor organisations, as supervisors, need to have confidence in audited financial information to ensure that we are making informed judgments and the right decisions when supervising firms ."

The draft rules were outlined as Michel Barnier, the European Union internal market commissioner, warned that auditing firms across the Eurozone face more competition and tougher regulation of their activities to restore their "tarnished" image.
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