Regulation

FRC reveals updated reporting and audit quality review programme

The FRC has announced its 2020/21 corporate reporting and audit quality review programme.

The FRC’s Corporate Reporting Review team will supplement its routine reviews of corporate reporting with “four thematic reviews”.

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These reviews will identify scope for improvement, as well as areas of better practices, in a number of areas of stakeholder interest. The FRC’s Audit Quality Review team has also signalled its areas of focus for audit monitoring.

In selecting corporate reports and audits for review, priority will be given to certain higher risk sectors.

The FRC  said it will follow-up its recent report on IFRS 16 in interim reports by considering how a sample of companies apply IFRS 16 to their annual report and accounts.

It will also assess the extent to which the findings of its reviews of interim reports have been addressed. A “deeper dive” will also be carried out into certain findings from the recent report into the application IFRS 15 disclosures.

Additionally, as part of the FRC’s audit monitoring programme, the AQR team expect to pay particular attention to the auditor’s work on:

  • Going concern and the viability statement
  • The Other Information in the Annual Report
  • Long-term contracts
  • The impairment of non-financial assets
  • Fraud risk
  • Application of new accounting standards (IFRS 15 & 16)                         

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