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Decisions taken by the FRC on applications for exemption from cap on non audit fees

DECISIONS TAKEN BY THE FRC ON APPLICATIONS FOR EXEMPTION FROM CAP ON NON-AUDIT FEES

Regulation 13 of the Statutory Auditors and Third Country Auditors Regulations 2016 and Article 4(2) of the EU Audit Regulation (EU 537/2014) provide that the Competent Authority may, upon a request by the statutory auditor or the audit firm ('the applicant'), and on an exceptional basis, allow an exemption from the 70 per cent cap on fees for non-audit services for a period not exceeding two financial years.

In the UK, for the audit of a public interest entity, the cap will not apply until the fourth financial period commencing on or after 17 June 2016. For applications received, the FRC has committed to publishing those decisions in full, except where that would risk harming the commercial interests of an applicant. In those cases, the decision will be published in abridged form.

In the quarter ending 30 April 2022 the FRC is reporting on three applications granted. Those marked ** relate to previous reporting periods in which the application could not be reported as the transaction or service it relates to was price sensitive at that time.

  1. ** FRC granted a waiver to KPMG LLP in respect of £0.28 million of reporting accountant work for Card Factory PLC to support a proposed US debt capital raise, and for costs incurred for previously approved work on an equity capital raise which was terminated.
  2. ** FRC granted a waiver to KPMG LLP in respect of £0.22-0.27 million of reporting accountant work for NewDay Funding 2017-1 plc, NewDay Funding 2018-1 plc, NewDay Funding 2018-2 plc, & NewDay Partnership Funding 2017-1 plc to support a proposed IPO.
  3. FRC granted a waiver to PwC LLP in respect of £0.9-1 million of reporting accounting work for Wm Morrison Supermarkets Ltd to support a proposed US debt issuance.

Financial Reporting Council

15 May 2022

8th Floor, 125 London Wall, London EC2Y 5AS Tel: +44 (0)20 7492 2300 Fax: +44 (0)20 7492 2301 www.frc.org.uk The Financial Reporting Council Limited is a company limited by guarantee. Registered in England number 2486368. Registered office: as above.

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Name Decisions taken by the FRC on applications for exemption from cap on non audit fees
Publication date 27 September 2023
Format PDF, 14.4 KB
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