ICAEW to get new local audit regulatory powers

Recognised Supervisory Body status has been granted to The Institute of Chartered Accountants in England and Wales (ICAEW) by the Financial Reporting Council (FRC).

This means the UK accountancy sector body now has new powers that will allow it to regulate firms who are looking to undertake local audits for clients, including councils and health bodies.

Audit and Accountability Act 2014

The new role for the ICAEW only applies to organisations in England and follows the introduction of the Local Audit and Accountability Act 2014.

This set of regulations set out a framework for the appointment and regulation of auditors working with the accounts of locally based public bodies.

The local bodies will now be able to choose which auditors to appoint, and those firms will have to be registered with a Recognised Supervisory Body (RSB).

Rigorous requirements

Those seeking registration, whether accountancy firms or individuals, will need to meet a rigorous set of requirements, according to the ICAEW.

These will include having an appropriate professional qualification such as the ACA, as well as proving relevant audit experience and a record of contemporary continuous professional development.

Vernon Soare, ICAEW executive director, explained: "There is more scrutiny than ever on how public money is spent. Local audits promote confidence in the financial management of local bodies which provide vital services to their communities. The firms on the public audit register will have gone through a rigorous and thorough process to make sure they provide a high quality audit service."