The Financial Reporting Council has today published its Third Progress Report on the implementation of the recommendations of the Market Participants Group (MPG) and other relevant developments.

Progress achieved in implementation of MPG recommendations following the November 2008 update includes:

• The issue by the Consultative Committee of Accountancy Bodies of the Voluntary Code of Practice on Disclosure of Audit Profitability; and
• The publication by the Audit Inspection Unit (AIU) of public reports on audit firms which had been subject to a full scope AIU review.

Other relevant developments include an exposure draft of revised Ethical Standards and the closure of consultations by the European Commission and the Audit Firm Governance Working Party on, respectively, ownership rules and a governance code for audit firms.

Paul Boyle, Chief Executive of the FRC said:

“Despite the progress that has been made, the FRC continues to have significant concerns about the risks posed by audit market concentration and believes that these risks are likely to continue for the medium to long term.”

1. The Financial Reporting Council (FRC) is the UK’s independent regulator responsible for promoting confidence in corporate reporting and governance.
2. The FRC’s functions are exercised principally by its operating bodies (the Accounting Standards Board, the Auditing Practices Board, the Board for Actuarial Standards, the Financial Reporting Review Panel, the Professional Oversight Board and the Accountancy and Actuarial Discipline Board) and by the Board. The Committee on Corporate Governance assists the Board in its work on corporate governance.
3. All media inquiries should be addressed to Paul George, Director of Auditing and Director, POB on 020 7492 2340.