1.1 The role of the Council is advisory to the FRC Executive on the development and maintenance of high quality, effective and proportionate Standards, Guidance, SORPS and Practice Notes for audit and assurance work. In so doing the Council will:
Provide perspective on the broader landscape affecting the quality of audit and assurance work;
Advise on the identification of current, emerging and potential risks to the quality of audit and assurance work and to the FRC’s responsibilities and strategic objectives in connection with audit and assurance matters.
Identify opportunities to promote the quality of audit and assurance work through Standards, Guidance, Practice Notes and Statements of Recommended Practice for audit and assurance work; and
Provide advice on audit and assurance matters.
1.2 Advice will be sought by and provided to the FRC Executive. The Board or its Committees may also seek input or advice from the Council on other matters as they see fit.
1.3 The Chair will report directly to the Board any material difference of view between the Council and the FRC Executive of which, in his/her judgement, the Board is not fully aware and, at his / her discretion, report any material concerns in relation to the performance, terms of reference or effectiveness of the Council which, in his/her judgement, have not been resolved through the annual wider Board effectiveness review process.
The Board shall appoint the Council Chair. The Codes & Standards Committee shall appoint up to 14 other Council members.
No more than half of the members of the Council shall be practising members of the audit profession.
The quorum for Council meetings shall be sixty percent of the members.
The Company Secretary or his / her nominee shall act as Secretary of the Council (the Secretary).
5 Frequency of Meetings
The Council shall usually meet four times a year with other meetings called as necessary dependent on the work plan. Ad hoc meetings of sub-groups of the Council may be convened as necessary.
6 Attendance at Meetings
Only members of the Council shall have the right to attend Council meetings. However, the relevant executive director and policy director will normally be invited to attend all Council meetings and other individuals may be invited to attend all or part of any meeting as and when appropriate.
7 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 made available to each member of the Council and any other person required to attend, no later than 5 working days before the date of the meeting.
8 Minutes of Meetings
The Secretary shall minute the proceedings of all meetings of the Council, including recording the names of those present and in attendance. Minutes of Council meetings shall be circulated to all members of the Council and, following approval, published on the FRC website.
The Council shall advise the FRC Executive on:
- The development of the FRC Strategy and Annual Plan in so far as it is relevant to the role of the Council.
- The development of the FRC Executive’s plan for Standards, Guidance and Statements of Practice for audit and assurance work including in relation to its contribution to the FRC Strategy and Annual Plan and on the implementation of the work plan as endorsed by the Board.
- The development and maintenance of Standards, Guidance, SORPS and Practice Notes for audit and assurance work.
- Proposed developments to international equivalents.
- The key messages to be included in FRC reports on its activities in relation to audit and assurance matters in so far as they are relevant to the role of the Council.
- The recognition of SORP making bodies and the approval of certain FRC statements on SORPs;
- Matters concerning the general effectiveness of the Council in performing its above responsibilities;
- Any other matters as requested by the Executive or the Board or its Committees.
10.1 Each year, the FRC Executive shall report to the Board on its plan for Standards, Guidance and Statements of Practice for audit and assurance work and seek the Board’s endorsement of those plans. The Executive’s report shall include the advice of the Council.
10.2 Council performance and its terms of reference shall be reviewed annually, including through consultation with the Council, as part of the wider Board effectiveness review process.
10.3 The FRC Executive may appoint ad hoc groups to advise on specific issues. The members of those groups may include members of the Council. The Executive shall annually review the continuing need for any such appointed groups.
Approved by the FRC Board with effect from 1 July 2018.