International Agreements and Arrangements
7 minute read
The FRC has entered into agreements and arrangements with the following overseas regulators on cooperation and exchange of information related to the oversight of auditors.
Approved third country qualifications
Australia
Under the powers delegated by the Secretary of State, the Financial Reporting Council (FRC), on behalf of the UK, can reach an agreement with other countries for the mutual recognition of statutory audit qualifications.
The FRC has worked with the Australian Securities & Investments Commission (ASIC) to reach an agreement, and on 26 March 2024 both parties signed a Memorandum of Understanding on Reciprocal Arrangements (MOURA). This agreement comes into effect on 26 March 2024.
The MOURA provides a pathway by which auditors who have obtained a professional audit qualification in either the UK or Australia can apply for recognition of their qualification and gain audit rights in the other jurisdiction. To achieve this, we have approved three qualifications as approved third country qualifications in the UK.
Under Section 1221 of the Companies Act 2006 the Secretary of State may make a declaration approving a third country qualification. This function of the Secretary of State has been delegated to the FRC. The FRC has made a declaration approving the following qualifications:
- CA Qualification awarded by Chartered Accountants Australia and New Zealand (CAANZ) in Australia to a person who has passed the Australian variant of the Taxation papers. This is subject to completing an adaptation period in the UK.
- CPA qualification awarded by CPA Australia (CPAA) in Australia to a person who:
- holds an accredited degree (under the joint CPA Australia and CAANZ scheme) or has completed the CPA Australia foundation papers; and
- has passed both the Advanced Auditing and Assurance elective paper and an elective paper in either Taxation (Australia) or Advanced Taxation.
This is subject to completing an adaptation period in the UK.
- Registered Company Auditor. Individuals registered by ASIC to conduct audits in Australia and who have either (i) successfully completed the CAANZ Chartered Accountant qualification and hold full membership of CAANZ or (ii) successfully completed the CPA Australia CPA qualification and hold full membership of CPA Australia. This is subject to completing a UK aptitude test.
In making these declarations the FRC is satisfied that these qualifications afford an assurance of professional competence equivalent to that afforded by a recognised professional qualification in the UK and that the treatment of persons who are subject to these declarations is, or is likely to be, comparable to the treatment that holders of a UK recognised professional qualification will receive in Australia.
| Name | Memorandum of Understanding on Reciprocal Arrangements with Australian Securities and Investments Commission |
|---|---|
| Publication date | 28 March 2024 |
| Type | Memorandum of understanding |
| Format | PDF, 516.4 KB |
| Name | Approval of Registered Company Auditor qualification as an approved third country qualification |
| Publication date | 28 March 2024 |
| Format | PDF, 305.6 KB |
| Name | Approval of CAANZ qualification as an approved third country qualification (Australia) |
| Publication date | 28 March 2024 |
| Format | PDF, 305.1 KB |
| Name | Approval of CPA Australia qualification as an approved third country qualification |
| Publication date | 28 March 2024 |
| Format | PDF, 306.3 KB |
| Name | FRC and ASIC (Australia) MOURA - FRC Guidance to Recognised Supervisory Bodies |
| Publication date | 14 October 2024 |
| Type | Guidance |
| Format | PDF, 231.3 KB |
New Zealand
Memorandum of Understanding on Reciprocal Arrangements with Financial Markets Authority (New Zealand)
As the competent authority, it is the Financial Reporting Council’s (FRC) role to negotiate agreements covering audit qualifications between the UK and third countries.
The FRC has worked with the Financial Markets Authority (FMA) in New Zealand to reach an agreement, and on 26 September 2023 both parties signed a Memorandum of Understanding on Reciprocal Arrangements (MOURA). This agreement comes into effect on 26 September 2023.
The MOURA provides a pathway by which auditors who have obtained a professional audit qualification in either the UK or New Zealand can apply for recognition of their qualification and gain audit rights in the other jurisdiction. To achieve this, we have approved three qualifications as approved third country qualifications in the UK.
Under Section 1221 of the Companies Act 2006 the Secretary of State may make a declaration approving a third country qualification. This function of the Secretary of State has been delegated to the FRC. The FRC Board has made a declaration approving the following qualifications:
- Licensed Auditors - individuals licenced to conduct FMC audits in New Zealand. This is subject to completing a UK aptitude test.
- CA Qualification awarded by Chartered Accountants Australia and New Zealand (CAANZ) in New Zealand to a person and where that person has passed the New Zealand variant of the Taxation papers. This is subject to completing an adaptation period in the UK.
- CPA qualification awarded by CPA Australia in New Zealand to a person and where that person:
- holds an accredited degree (under the joint CPA Australia and CAANZ scheme) or has completed the CPA Australia foundation papers; and
- has passed both the Advanced Auditing and Assurance elective paper and an elective paper in either Taxation (New Zealand) or Advanced Taxation;
This is subject to completing an adaptation period in the UK.
In making these declarations the FRC is satisfied that these qualifications afford an assurance of professional competence equivalent to that afforded by a recognised professional qualification in the UK and that the treatment of persons who are subject to these declarations is, or is likely to be, comparable to the treatment that holders of a UK recognised professional qualification will receive in New Zealand.
| Name | Memorandum of Understanding on Reciprocal Arrangements with Financial Markets Authority (New Zealand) |
|---|---|
| Publication date | 26 September 2023 |
| Format | PDF, 336.1 KB |
| Name | Approval of Licensed Auditor qualification as an approved third country qualification |
| Publication date | 26 September 2023 |
| Format | PDF, 135.2 KB |
| Name | Approval of CAANZ qualification as an approved third country qualification (New Zealand) |
| Publication date | 27 September 2023 |
| Format | PDF, 132.2 KB |
| Name | Approval of CPA Australia qualification as an approved third country qualification |
| Publication date | 26 September 2023 |
| Format | PDF, 132.9 KB |
| Name | Memorandum of Understanding on Reciprocal Arrangements with Financial Markets Authority (New Zealand) FAQs |
| Publication date | 27 September 2023 |
| Format | PDF, 134.0 KB |
| Name | FRC and FMA (New Zealand) MOURA - FRC Guidance to Recognised Supervisory Bodies |
| Publication date | 12 July 2024 |
| Format | PDF, 228.0 KB |
Switzerland
As the competent authority, it is the Financial Reporting Council’s (FRC) role to negotiate agreements covering audit qualifications between the UK and third countries.
The FRC has worked with the Federal Audit Oversight Authority of Switzerland to make arrangements for mutual recognition of statutory audit qualifications.
On 8 December 2023, letters were exchanged between the FRC and the Federal Audit Oversight Authority of Switzerland, to confirm understanding of arrangements for mutual recognition of statutory audit qualifications. Those arrangements are effective from 8 December 2023.
The arrangements provide a pathway by which auditors who have obtained a professional audit qualification in either the UK or Switzerland can apply for recognition of their qualification and gain audit rights in the other jurisdiction. To achieve this, we have approved the Swiss Licensed Audit Expert qualification, Swiss Certified Public Accountant route as an approved third country qualification in the UK.
Under Section 1221 of the Companies Act 2006 the Secretary of State may make a declaration approving a third country qualification. This function of the Secretary of State has been delegated to the FRC. The FRC has made a declaration approving the Swiss Licensed Audit Expert qualification, Swiss Certified Public Accountant route as an approved third country qualification in the UK. This is subject to applicants passing an aptitude test in UK tax and law.
In making this declaration the FRC is satisfied that the Swiss Licensed Audit Expert qualification, Swiss Certified Public Accountant route, affords an assurance of professional competence equivalent to that afforded by a recognised professional qualification in the UK and that the treatment of persons who are subject to these declarations is, or is likely to be, comparable to the treatment that holders of a UK recognised professional qualification will receive in Switzerland.
| Name | Letter of Understanding from FAOA on Mutual Recognition of Statutory Audit Qualifications |
|---|---|
| Publication date | 8 December 2023 |
| Format | PDF, 1.2 MB |
| Name | FRC to FAOA Letter of Understanding on mutual recognition of statutory audit qualifications |
| Publication date | 8 December 2023 |
| Format | PDF, 167.1 KB |
| Name | Approval of Swiss Licenced Audit Expert CPA route as an approved third country qualification |
| Publication date | 8 December 2023 |
| Format | PDF, 35.5 KB |
| Name | FRC and FAOA Mutual Recognition Arrangements for Statutory Auditors - FRC Guidance to Recognised Supervisory Bodies |
| Publication date | 31 January 2025 |
| Format | PDF, 291.5 KB |
| Name | Memorandum of Understanding between FRC and Swiss Federal Audit Oversight Authority (March 2014) |
|---|---|
| Publication date | 3 April 2014 |
| Type | Memorandum of understanding |
| Format | PDF, 5.3 MB |
Recognition of statutory auditors from third countries under the Professional Qualifications Act 2022
Norway, Iceland and Liechtenstein
In July 2021 the UK and the EEA EFTA states (Norway, Iceland and Liechtenstein) signed a Free Trade Agreement. The parties to the Free Trade Agreement are required to put arrangements in place for mutual recognition of professional qualifications. These requirements were brought into UK law on 1 December 2023 by the Recognition of Professional Qualifications and Implementation of International Recognition Agreements (Amendment) Regulations 2023 (the Regulations).
The Regulations require UK regulators to make arrangements for recognition of professional qualifications from specified states. The specified states are Norway, Iceland and Liechtenstein. The Regulations allow UK regulators to require applicants to complete aptitude tests or adaptation periods or both where the applicant’s qualification does not cover all the essential knowledge or skills required to be a UK statutory auditor.
The FRC has reviewed the qualifications of statutory auditors in the specified states and compared these with UK audit qualifications.
The FRC has developed a Guidance Note for UK Recognised Supervisory Bodies to apply when making arrangements to process applications from statutory auditors in Norway, Iceland and Liechtenstein under their approval and registration functions. The FRC’s guidance is that such applicants who pass an aptitude test hold an appropriate qualification for the purpose of becoming a UK statutory auditor.
| Name | Recognition of specified state auditors under the UK EEA EFTA Free Trade Agreement |
|---|---|
| Publication date | 7 May 2025 |
| Type | Guidance |
| Format | PDF, 281.2 KB |
Memoranda of understanding on cooperation and exchange of information
Canada
| Name | Memorandum of Understanding between the Canadian Public Accountability Board (CPAB) and the FRC (December 2016) |
|---|---|
| Publication date | 1 August 2017 |
| Type | Memorandum of understanding |
| Format | PDF, 2.2 MB |
Ireland
| Name | Memorandum of Understanding between the Irish Auditing and Accounting Supervisory Authority and the FRC on co-operation and exchange of information related to the oversight of auditors |
|---|---|
| Publication date | 10 October 2024 |
| Type | Memorandum of understanding |
| Format | PDF, 384.3 KB |
Japan
| Name | Letter on cooperation between CPAAOB/JFSA and FRC (June 2014) |
|---|---|
| Publication date | 6 June 2014 |
| Format | PDF, 2.9 MB |
| Name | Letter on cooperation between FRC and CPAAOB/JFSA (June 2014) |
| Publication date | 6 June 2014 |
| Format | PDF, 3.0 MB |
United States of America
| Name | Statement of Protocol between the FRC and the PCAOB (April 2017) |
|---|---|
| Publication date | 17 April 2017 |
| Type | Statement |
| Format | PDF, 1.7 MB |
| Name | Agreement between the Financial Reporting Council in the United Kingdom and the Public Company Accounting Oversight Board in the United States of America on the Transfer of Certain Personal Data |
| Publication date | 27 November 2024 |
| Format | PDF, 798.0 KB |