Financial Reporting Council (FRC)
The FRC has been consulting on choice in the audit market since publishing a discussion paper in 2006. Regular updates and reports can be found in the Audit Choice Project section of the FRC website.
House of Lords Economic Affairs Committee
In 2010, the House of Lords Economic Affairs Committee (HoL EAC) announced an eight month investigation into competition and choice in the audit market. The review concluded in March 2011 and with the committee publishing its findings on 30 March 2011.
The government published its response to the HoL EAC report in June 2011.
EU Green Paper: Audit: Lessons from the Crisis
On October 13 2010, the European Commission launched a consultation on the role of statutory audit. The Green Paper covered issues such as the concentration in the audit market and its implications on financial stability, the emergence of small and medium sized practitioners, the audit of SMEs and international standards on auditing.
The Commission published draft legislative and regulatory proposals for the reform of statutory audit in November 2011.
Office of Fair Trading
The Office of Fair Trading (OFT) has been keeping a watching brief on the audit market since 2002, considering whether to refer the market to the Competition Commission following concerns in the wake of the Enron scandal and the collapse of Arthur Andersen. In September 2010, the OFT set out its concerns to the House of Lords Economic Affairs Committee.
In May 2011, the OFT decided that problems existed in the audit market and started consulting on whether there were workable remedies to resolve them.
At the end of July 2011, the OFT provisionally decided to refer the audit market to the Competition Commission. The OFT consultation on referral closed on 9 September 2011 and they confirmed this decision on 21 October 2011.
The Competition Commission launched an inquiry into the audit market following the referral from the Office of Fair Trading on 21 October 2011. The inquiry is set to last two years and the issues they are considering were set out in an issues statement published in December 2011.
Public Company Accounting Oversight Board (PCAOB)
On August 16 2011, the Public Company Accounting Oversight Board (PCAOB), released a concept paper raising the possibility of mandatory auditor rotation.
International Auditing and Assurance Standards Board (IAASB)
On 16 May 2011 the International Auditing and Assurance Standards Board (IAASB) launched a consultation, Enhancing the Value of Auditor Reporting: Exploring Options for Change.