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

Progress made in implementing the MPG Recommendations since the October 2010 update includes:

• The release by the Audit Firm Governance Working Party of its best practice code on the governance of audit firms; and
• Improved transparency reporting by the majority of relevant audit firms.

International developments include the announcement by the European Commission of a Green Paper on auditing and the expected passage of the Restoring American Financial Stability Bill, which should allow for easier co-operation between US and European regulators.

Stephen Haddrill, Chief Executive of the FRC, said:

“It is now more than 30 months since the publication of the MPG’s recommendations and, whilst progress has been made in implementing them, it is clear that the risks arising from the extent of concentration in the audit market persist. Over the next six months the FRC will assess the effectiveness of the Recommendations as a whole and make clear proposals on what further action is required”.
 

1. The Financial Reporting Council (FRC) is the UK’s independent regulator responsible for promoting high quality corporate governance and reporting to foster investment.
2. The Market Participants’ Group (MPG) consisted of investors, companies and audit firms and was established by the FRC in October 2006. In October 2007, the MPG published 15 Recommendations intended to allow the audit market to work more efficiently and, in the medium-to-long-term, to increase audit choice in the UK.
3. Press enquiries should be made to Paul George, telephone 020 7492 2340.