Overhaul of corporate reporting and audit regime

The government has announced it will update the UK’s corporate reporting and audit regime through a new regulator.

The Audit, Reporting and Governance Authority (ARGA) will replace The Financial Reporting Council (FRC). ARGA will be given tougher enforcement powers and it will be funded by a levy on industry.

The creation of this new regulator will help reduce the risk of sudden big company collapses and help to safeguard jobs.

Already, the Business Secretary is taking steps to enable the regulator to ban failing auditors from reviewing large companies’ accounts.

This revamp of audits and corporate reporting will offer transparency of the status of large companies to help encourage future investment. Its aim is also to help prevent sudden collages of large companies which can have a huge impact on many other small businesses and contractors and job loss.

Minister for Corporate Responsibility Lord Callanan said: “Collapses like Carillion have made it clear that audit needs to improve, and these reforms will ensure the UK sets a global standard.

“By restoring confidence in audit and corporate reporting we will strengthen the foundations of UK plc, so it can drive growth and job creation across the country.”

This new regulator will focus on the UK’s largest companies including private companies which will also have to adhere to the new regulator – not just companies listed on the stock exchange. This impacts unlisted companies with over 750 employees and with over £750 million annual turnover.

You can read more about the government’s Audit regime overhaul to help restore trust in big business here.

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