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Auditors’ reporting on themselves is ‘ineffective’, FRC says

The Financial Reporting Council reviewed reports from 33 UK auditing firms, including: PwC, KPMG, Deloitte, Ernst & Young, Grant Thornton, BDO and Mazars

KPMG's offices in 15 Canada Square, Canary Wharf
KPMG's offices in 15 Canada Square, Canary Wharf Photo: Getty Images

New transparency standards for audit firms have so far proved “ineffective” and are widely misused as a “marketing exercise”, according to the sector’s watchdog.

Introduced in 2016, the standards require audit firms that review the books of publicly listed firms to prepare an annual “transparency report” setting out details of their own legal and governance structures, internal quality control systems, key performance indicators and independence practices.

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