Auditors Professional Oversight Oversight of Audit FRC’s Eligibility Criteria for Statutory Auditors

FRC’s Eligibility Criteria for Statutory Auditors

Regulation 3(1) of SATCAR 2016 sets out the responsibilities of the Competent Authority. Regulation 3(1) (a) covers responsibility for oversight and Regulation 3(1) (g) the task of registration. Regulation 3(1) (f) covers the determination of criteria for the purpose of determining whether persons are eligible for appointment as statutory auditors - the Eligibility Criteria. The determination of eligibility criteria is a task that has been retained by the FRC by agreement with the RSBs on the basis that it is sensible as Competent Authority that we retain the setting of the defining criteria for eligibility.

The Competent Authority has delegated the task of approving and registering individuals and firms to the Recognised Supervisory Bodies (RSBs) and has issued these Eligibility Criteria to set out the minimum requirements that the Registration Committees of the RSBs must apply.

After the end of the transition period the current regulatory framework for statutory auditors will no longer work effectively without changes to legislation. The legislative changes required have been made by Statutory Instruments including the Statutory Auditors and Third Country Auditors (Amendment) (EU Exit) Regulations 2019. These Statutory Instruments make some changes to the categories of person who may be eligible for appointment as UK statutory auditors, in particular by removing or time-limiting the eligibility of EEA auditors and EEA audit firms. The Eligibility Criteria are effective from the transition period completion date (11pm on 31 December 2020) to ensure consistency with these legislative changes.