Innovation and Improvement Hub (overview)
2 minute read
Background
The Innovation and Improvement Hub is the FRC’s programme to promote innovation across our remit of corporate reporting, corporate governance, actuarial, audit and assurance. Hub projects provide an exploratory space for collaborative problem-solving with market participants while supporting high standards and economic growth. Supporting innovation is one of the commitments set out in our 3-year strategy.
Current initiatives
Sandbox: Simplifying Annual Reporting
This sandbox invites listed companies to work directly with the FRC to produce clearer and more streamlined annual reports. Against an industry trend of reports ever-increasing in length, the FRC’s expert teams engage with preparers to navigate reporting frameworks and cut down unnecessary volume encouraging them to produce a report which is more useful and accessible to investors while complying with regulatory requirements.
Sandbox: Audit Tech and AI
The Audit Tech and AI Sandbox aims to support audit firms looking to adopt AI, software, new products and features, or other technology to improve audit quality and drive better outcomes.
Through a structured engagement plan, the sandbox will work with firms across the audit market who are looking to innovate or adopt new technology, have considered the key regulatory issues, and would benefit from collaborating with the FRC on how audit standards and guidance on technology can be applied in practice.
Audit and Assurance Sandbox
The Audit and Assurance Sandbox is a collaborative and innovative approach to identifying and developing solutions to technical and policy issues in the audit and assurance space.
Recent initiatives have focused on, for example, materiality in small and medium-sized enterprise (SME) audits; the Objective, Reasonable and Informed Third Party Test; and the auditor’s responsibilities over the Provision 29 statement.
Audit Firm Scalebox
The FRC's Audit Firm Scalebox is a dedicated programme to help firms develop and maintain audit quality as they enter and grow in the PIE audit market. The Scalebox also allows us to understand these firms better, enhancing our supervisory approach accordingly.
Building Capability in Smaller Firms
This initiative supports the development of the capability and quality management by small audit firms looking to establish a greater presence in the UK Public Interest Entity (PIE) audit market.
Other activities
The FRC strives to be an improvement regulator with a culture of innovation embedded in our ways of working. Other recent initiatives the FRC is working on which highlight innovation and improvement include:
Featured initiatives
Learn about our work on the following initiatives.
Supporting SMEs
The FRC provides resources and tools designed to make audits more proportionate and efficient for small and medium-sized enterprises (SMEs), helping to support their growth and access to capital.
Small and medium-sized enterprises (SMEs)
Encouraging AI in audits
The FRC encourages responsible use of AI, including generative AI, to improve audit quality. We have published two pieces of guidance to support firms, covering a number of use cases.