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image of weak nerd | accountingweb | No sheriff in town; FRC admits it is weak and beholden to business

FRC admits it is weak and beholden to business


A regulator with no powers to regulate, which has to beg the bodies it oversees to supply critical funding and data, is how the UK accounting watchdog was described by its own chief executive.

27th Mar 2024
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Richard Moriarty, CEO of the Financial Reporting Council (FRC), told lawmakers “serious gaps” remain in its toolkit five years on from a set of sweeping government reforms. The reforms were proposed in the wake of several high-profile corporate collapses but never materialised.

“I am sheriff for only half the county, and my arsenal is weaker than other regulators would have,” Moriarty told MPs on the Business and Trade Committee this week. 

He said while the FRC had “come a long way” since the scandal-ridden collapse of construction outsourcer Carillion, the shortcomings of a regulatory authority that has no competition power or authority to demand information from businesses remain clear.

“I am beholden to the voluntary provision of information from those I regulate,” Moriarty said. “Having regulated other sectors, I can compare and contrast; this is an anomalous situation. 40% of my income I effectively have to beg for.”

How audit reform failed

In a parliamentary panel on delays to audit reform the committee took evidence from Moriarty and a host of influential figures across the world of accountancy to understand why the once fervent drive for change within the audit sector has fizzled out.

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Replies (2)

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By ireallyshouldknowthisbut
27th Mar 2024 16:36

The whole point of the FRC is to be rather ineffectual. See also the regulators for the water industry, the enviroment agency and all the rest of it.

They are all working as they should - neutered and without power.

If you have been following this with David Neal, this is endemic, misunderstand your role, and think you are there to do a proper job, and you are out on your ear:

Thanks (2)
28th Mar 2024 11:27

Pray tell me why are we paying all these people merely to allow them to spend there time giving excuses as to why they can only play games on their smart phones during office hours?

Thanks (1)