The UK Financial Reporting Council (FRC) has confirmed a minor change to its Auditor Regulatory Sanctions Procedure (ARSP) and the Crown Dependencies’ Recognised Auditor Sanctions Procedure (CD RASP).
The ARSP sets out how the FRC responds to breaches of the Regulatory Framework for Auditing in relation to major local audits.
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These major local audits principally involve local authorities and health bodies other than Foundation Trusts.
When the Audit Quality Review team identifies potential non‑compliance with local audit requirements, the FRC can independently decide that an audit company has failed to follow the relevant rules and may be subject to sanctions.
The Crown Dependencies’ Recognised Auditor Regulatory Sanctions Procedure, renamed CD RASP from 1 March 2026, applies when the Audit Quality Review team inspects a Recognised Auditor registered in Guernsey, the Isle of Man or Jersey.
The latest amendment affects the governance of sanctions decisions rather than the substance of the regimes.
Responsibility for appointing a secretary to an Independent Sanctions Tribunal will move from the FRC’s Conduct Committee to the FRC’s People Committee.
This change will take effect from 1 November 2026.
The revision will be made to paragraph 14.3 of both the ARSP and CD RASP, which are currently identical.
After the change becomes effective the paragraph will read: “14.3 The People Committee will appoint a secretary to an Independent Sanctions Tribunal to administer the Tribunal.”
Recently, the FRC also updated revised directions for Third Country Auditors, which will be effective from 1 September 2026.
