UK report on audit quality
The Brydon Report, scheduled for release later this year, aims to assess the quality and effectiveness of the audit market and comes as a result of the government’s commitment to improve governance and reduce the risk of corporate scandals. The report will focus more on audit standards than on the way that the market functions. The review comes at the same time as a Parliamentary enquiry continues into the future of audit. Donald Brydon, departing chair of the London Stock Exchange Group, was appointed to lead the review.
Stewardship consultation announced
The Financial Reporting Council (FRC) has introduced a consultation on a new stewardship code for investors. The UK code has not been revised since 2012 and, in light of the new corporate governance code, was considered in need of review. The consultation focuses on a code that is more specific to individual actors within the supply chain. The consultation is open until 29 March.
New reporting guidelines
The UK Government issued guidelines on environmental reporting standards in January. The main changes concentrate on carbon and energy reporting and steps that are needed to assess these. There is additional information on how voluntary reporting can be done.
Stewardship and shareholders discussion paper
The Financial Conduct Authority (FCA) and the FRC have launched a consultation paper on implementing the second shareholder rights directive into UK law. The directive’s focus is on how all shareholders within the investment chain can better co-operate to hold businesses to account. The paper was published on the same date as an FCA paper looking at the regulatory duties for finance professionals, which result from a new stewardship code. Both consultations will run until 30 April.
— David Hackett is technical policy manager at the Association of International Certified Professional Accountants. To comment on this article or to suggest an idea for another article, contact Neil Amato, an FM magazine senior editor, at Neil.Amato@aicpa-cima.com.