Britain has launched a “root and branch” review of its audit watchdog after corporate scandals raised questions about its ability to police how accountants check the books of companies.

The independent review of the Financial Reporting Council (FRC) aims to bolster Britain’s reputation for upholding corporate standards, seen as critical to maintaining the country’s attractiveness for investment after it leaves the European Union next year.

Business minister Greg Clark said the review will be chaired by John Kingman, a former top finance ministry official and now chairman of insurer Legal & General (LGEN.L). It will assess how the FRC is run, its impact and powers. It is due to be completed by the end of this year.

“The UK has a strong reputation as a dependable place to do business, but this needs to be continuously updated and it’s important to ensure all of our regulators continue to drive high standards,” Clark said in a statement on Tuesday.

“This review is part of the government’s industrial strategy aim of creating a business environment that ensures our regulators are fit for the future and our markets are working for consumers.”

FRC faced tough questions from lawmakers after taxpayers had to bail out several lenders during the global banking crisis, only months after accountants gave the green light to financial statements.

FRC Chairman Win Bischoff welcomed the review.

– Reuters, 17 April 2018

Link here to the Reuters article.

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