The FRC’s supervisory approach
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Audits underpin trust and transparency in financial reporting, enabling companies to access capital and maintain the UK's position as a leading global business environment. Firms delivering high-quality audits support investor confidence and long term economic growth.
Our supervision of audit firms is rooted in strengthening audit quality, ensuring accountability, and supporting public interest across the audit system. By delivering effective supervision, grounded in proportionate and robust engagement, the FRC provides firms with consistent, professional and transparent regulatory oversight.
In March 2025, the FRC launched a review of its audit supervision through its Future Audit Supervision Strategy project. The audit market has rapidly evolved in recent years, shaped by technology, new business models and shifting expectations. It is important that our regulatory model remain responsive to these changes.
As part of this project, the FRC carried out a programme of extensive stakeholder engagement and in August 2025 published a discussion paper seeking stakeholder views on draft proposals for its revised supervisory approach.
The FRC's Future Audit Supervision - Discussion paper on the future approach
In March 2026, the FRC published a statement setting out details of its revised supervision approach, which introduces a more proportionate, effective and integrated framework designed to enhance audit quality and reinforce resilience across the UK audit market. Stakeholder feedback in the 2025 discussion paper directly informed the development of the revised approach to audit supervision.
Implementation will begin in April 2026 for the largest firms, with further developments piloted during 2026/27. The Building Capacity and Capability for Smaller Firms initiative - launched in 2025 - was also an early development within the FASS project, that has already begun to support smaller firms to further enhance their system of quality management. This work will also complement our SME market study initiatives in supporting a more coordinated supervisory framework across both Public Interest Entity (PIE) and non-PIE audits.
| Name | An evolved audit supervision approach |
|---|---|
| Publication date | 25 March 2026 |
| Type | Statement |
| Format | PDF, 1.0 MB. View HTML version |