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Clifford Chance

Clifford Chance


CMA proposals to reform the statutory audit market

24 April 2019

The future of auditing and of audit firms is very much in the spotlight at the moment and this has potentially far reaching implications for companies and their boards and Audit Committees. The Competition and Markets Authority has recommended that the Government legislates to empower a new regulator, the Audit, Reporting and Governance Authority (which will replace the Financial Reporting Council) to scrutinise and hold to account Audit Committees and to require FTSE 350 companies to be subject to a joint audit by two audit firms (one of which must not be one of the 'Big Four' accountancy firms). It has also proposed a major shake-up of audit firms with the operational separation of audit and non-audit activities.

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