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About the FRC FRC Structure Audit Quality Review Committee

Audit Quality Review Committee

The Audit Quality Review (AQR) Committee helps ensure the consistency and quality of the FRC’s audit monitoring work.  Its functions include:
  • Providing advice to the Executive in respect of the inspection review grade for individual audit engagements and the letter summarising the key findings from a review of an individual audit engagement.
  • Taking steps delegated to the AQR Committee under the Auditor Regulatory Sanctions Procedure  and the Crown Dependencies Recognised Auditor Regulatory Sanctions Procedure including considering whether there is an indication that a Registered Auditor / Recognised Auditor has failed to comply with the Regulatory Framework for Auditing.
  • Agreeing audit monitoring public reports on individual firms.
  • Reviewing any other draft audit inspection reports referred by the Executive.
  • Recommending to the Conduct Committee any draft report setting out key findings from the FRC’s audit inspection activities.
  • If appropriate, referring any matter to the Conduct Committee or Case Examiner, as applicable, to consider action under one of the FRC’s disciplinary schemes or enforcement procedures.
  • Performing any other functions as shall be determined by the Conduct Committee from time to time.

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Audit Quality Review Committee Terms of Reference

1. Membership

The Board shall appoint a member of the Conduct Committee to be the Chair of the AQR Committee. The Conduct Committee shall appoint up to 5 other members to the AQR Committee, including but not limited to other members of the Conduct Committee.

No member of the AQR Committee shall be a practising auditor or an officer of any of the accountancy professional bodies.

2. Quorum

The quorum for AQR Committee meetings shall be 3 members.

3. Secretary

The Company Secretary or his/her nominee shall act as Secretary of the AQR Committee (the Secretary).

4. Frequency of Meetings

The AQR Committee shall meet as required.

5. Attendance at Meetings

Only members of the AQR Committee shall have the right to attend AQR Committee meetings. However other individuals may be invited to attend all or part of any meeting as and when appropriate.

6. Notice of Meetings

Unless otherwise agreed, notice of each meeting confirming the venue, time and date, together with an agenda of items to be discussed and supporting papers, shall be forwarded to each member of the Committee and any other person required to attend, no later than 5 working days before the date of the meeting.

7. Minutes of Meetings

The Secretary shall minute the proceedings and resolutions of all meetings of the AQR Committee, including recording the names of those present and in attendance. Minutes of AQR Committee meetings shall be circulated to all members of the Committee and the Conduct Committee.

8. Responsibilities

 

  • The AQR Committee shall:
    • Provide advice to the Executive in respect of the inspection review grade for individual audit engagements, and
    • Provide advice to the Execuitve in respect of the letter summarising the key findings from a review of an individual audit engagement, where those matters are referred to the Committee by the Executive;
  • Take all steps delegated to the AQR Committee under the Auditor Regulatory   Sanctions Procedure (“ARSP”) and the Crown Dependencies Recognised Auditor Regulatory Sanctions Procedure (“CD RARSP”) including considering whether there is an indication that a Registered Auditor/Recognised Auditor has failed to  comply with the Regulatory Framework for Auditing and the criteria in paragraph  4.1 of the ARSP or CD RARSP, as applicable, may be satisfied;
  • Agree audit monitoring public reports on individual firms;
  • Review any other draft audit inspection reports referred by the Executive;
  • Recommend to the Conduct Committee any draft report setting out key findings from the FRC’s audit inspection activities;
  • If appropriate, refer any matter to the Conduct Committee or Case Examiner, as applicable, to consider action under one of the FRC’s disciplinary schemes or enforcement procedures; and
  • Perform any other function as shall be determined by the Conduct Committee from time to time.

9. Reporting Responsibilities

The AQR Committee Chair shall report to the Conduct Committee on its activities and proceedings at Conduct Committee meetings no less than four times a year.

10. Other

The AQR Committee shall have access to sufficient resources and is authorised to seek information from the FRC executive in order to carry out its responsibilities.

Approved by the FRC Board with effect from 17 June 2016.