FRC sets out requirement to audit firms on non-financial conduct
Released 24 July 2019
The FRC has written to the six largest audit firms setting out its expectations for reporting of non-financial conduct to the FRC.
The FRC has set out its expectation for reporting of non-financial conduct as part of its Audit Firm Monitoring and Supervision (AFMAS) responsibilities.
The framework focusses on five key pillars:
•leadership and governance;
•values and behaviours;
•business models and financial soundness;
•risk management and control; and
The FRC wants the top six audit firms to provide them with their policies and procedures in relation to ‘internal whistle-blowing, grievance, disciplinary matters and complaints from individuals outside the firm. This information is requested no later than 30 August 2019.
The FRC also requests that firms develop a regular process for reporting of non-financial conduct complaints. They request that firms report to them quarterly, starting from the quarter to 30 September 2019, with the report being due by 11 October 2019.