The UK’s Financial Reporting Council has announced a package of measures aimed at making audits more proportionate and efficient for SMEs.
To help this process FRC will:
- Publish new guidance to support auditors apply auditing standards in a way that is relative to the complexity and size of the business.
- Launch a new programme of engagement with auditors of SMEs to support understanding of this new guidance.
- Develop a Technology Sandbox within the FRC’s Innovation and Improvement Hub to enable smaller audit firms to explore the use of AI in corporate reporting.
- Establish a new working group with the Recognised Supervisory Bodies (RSBs) to promote more consistency in how audits of SMEs are supervised.
- Engage with stakeholders on the international Less Complex Entities auditing standard, providing UK stakeholders with the opportunity to influence its future development.
Supporting SMEs is part of the FRC’s wider work to reduce burdens on businesses and support economic growth.
Richard Moriarty, FRC Chief Executive, said: “We’ve been looking closely a how we can reduce complexity and make sure regulation remains proportionate for UK businesses. As regulators, it is important that we challenge ourselves on where we might be creating unnecessary burdens on businesses and take steps to ease them.
“I am really pleased with how quickly we have been able to deliver this project.”
