Question to the Department for Business, Energy and Industrial Strategy:

To ask the Secretary of State for Business, Energy and Industrial Strategy, who is responsible for monitoring good governance of the Recognised Supervisory Bodies.

The Secretary of State has delegated responsibility for overseeing the work of recognised supervisory bodies (RSBs) to the Financial Reporting Council (FRC). The FRC must be satisfied that an RSB meets the conditions set out in Schedule 10 of the Companies Act 2006, as amended by the Statutory Auditors and Third Country Auditors Regulations 2016, in order for it to be recognised. In addition, as the competent authority for statutory audit, the FRC must be satisfied that each RSB has the necessary arrangements in place to fulfil the audit regulatory tasks delegated to it by the FRC.

If necessary where there is a failure to meet the required conditions the FRC can reclaim any audit regulatory functions that it has delegated to an RSB. If an RSB does not meet the Schedule 10 requirements, the FRC can remove the body’s recognition as a supervisory body.