FRC

FRC Revolution to Fix Audit and Accounting Problems

A major announcement that will impact investors was made yesterday by the Government. You may not have noticed it in the midst of political turmoil, but it’s worth studying. The Kingman review of the Financial Reporting Council (FRC) was published last December. It was a quite damning criticism of many aspects of the current regulatory regime that had resulted in so many audit failures and poor-quality financial reporting. See my previous blog post on this subject here: https://roliscon.blog/2018/12/18/all-change-in-the-audit-world/ There are few experienced investors ...
Post Date: March 12, 2019 Read more

The Unstoppable Glacier of Government’s Concerted Actions?

By Cliff Weight, Director, ShareSoc We sometimes see things changing at a glacier-like pace. But once a glacier starts moving it has huge momentum and is unstoppable. My question is: is this metaphor applicable to the way Government is behaving with regard to business? The civil servants who drive Government policy transcend the short lives of Parliament. Taking this perspective what do we see? My take on this is as follows. The Financial Crisis terrified nearly everyone. We stared into the abyss. We were ...
Post Date: March 5, 2019 Read more

Response to FRC Post Implementation Review of 2016 Ethical and Auditing Standards

UKSA and ShareSoc made a a joint response to the FRC Post Implementation Review of 2016 Ethical and Auditing Standards The main points we made were: We welcome the FRC’s decision to hold a post-implementation review of the 2016 Ethical and Auditing standards. The audit profession and audits are in a state of crisis. The recent cases of Carillion, Conviviality, Patisserie Holdings, Flybe and Interserve make investors very worried as to whether they can trust accounts. It is not just the high ...
Post Date: February 14, 2019 Read more

Stephen Haddrill, CEO, FRC sees the light and gets tougher.

Stephen Haddrill, head of the Financial Reporting Council, appeared before MPs in one of a series of hearings held by the Commons Business, Energy and Industrial Strategy Committee to examine the future of the auditing industry in the wake of a number of scandals involving overstatement of profit and insolvency. When asked whether the FRC and other regulators were “too passive and reactive”, Mr Haddrill acknowledged that he should have been less afraid to challenge companies in the courts and less accepting ...
Post Date: February 6, 2019 Read more

FRC Review of Auditing Standards – They’re Looking At The Wrong Things

The Financial Report Council (FRC) have recently published a “Post Implementation Review: 2016 Ethical and Auditing Standards”. It concentrates on the changes made in 2016 to improve the independence...
Post Date: February 2, 2019 Read more

Remuneration Update

by Cliff Weight, Director, ShareSoc. On 22 November 2018, the Investment Association (“IA”), wrote to the chairmen of the remuneration committees of FTSE 350 companies attaching its updated Principles of Remuneration . These changes to the IA guidelines have been made against the backdrop of the new remuneration provisions in the UK Corporate Governance Code and the changes to the reporting of directors’ remuneration which is due to come into force for accounting periods beginning on or after 1 January 2019. MM&K's excellent(*) review ...
Post Date: December 22, 2018 Read more

Big Audit Firm Break-Up and Northern VCT AGM

A report commissioned by the Labour Party has advocated the break-up of the big four audit firms that dominate the audits of FTSE-350 firms. The report, co-authored by Prof. Prem Sikka et al, even goes so far as to suggest that their share of that market should be limited to 50% and that joint audits be promoted. In addition it argues that audit firms should be banned from doing non-audit work for the same company, and an independent body to appoint audit ...
Post Date: December 16, 2018 Read more

Blancco AGM and Regulatory Landscape

Today I attended the Annual General Meeting of Blancco Technology Group (BLTG). This technology company is now focused on the data erasure market which is surely a growing one. I have commented on this company before (see links below), particularly as the company, and its shareholders, seemed to be a victim of false accounting – an issue that is way too prevalent of late. The legal framework under which companies, their directors and the regulatory bodies operate just seems to be too ...
Post Date: December 16, 2018 Read more

Acquittals Over Tesco Fraud

Yesterday (6/12/2018) was another sad day for those who would like to stop false accounts being published by public companies. Two former executives of Tesco who had been charged with their involvement in the inflating of Tesco’s profits by including supplier credits were discharged by the court on the basis that they had no case to answer. The judge, Sir John Royce, said the case was so weak that it should not be put to a jury. It appears that the problem ...
Post Date: December 15, 2018 Read more

FRC Slides 3 Dec 2018, How to Complain and Appeal for Volunteers

I have received this feedback from the FRC "Thank you very much for rounding up a great audience on Monday, we are very pleased with how the event went. Please find attached the slides and feel free to circulate them to attendees." So, here are the slides. Lifting the Lid Event Slides - 3 December 2018 The FRC stressed they want to hear our complaints about companies and auditors. If you have a complaint then send it to the FRC complaints email oversight@frc.org.uk. If you wish to ...
Post Date: December 7, 2018 Read more