FRC warns firms to maintain high standards as recession bites
Audit quality could be the latest casualty of the downturn as accounting firms cut costs in some of the toughest market conditions seen in ten years, regulators warn.
The Financial Reporting Council (FRC) wants accounting firms to maintain high audit standards despite near unprecedented pressure on profit margins.
Paul George, head of the FRC’s Professional Oversight Board, is concerned that a general downturn in audit work might see firms concentrate on their bottom line at the expense of audit quality.
Markets rely on auditors to provide assurance and comfort about company performance and data. It’s feared cost cuts could promote a culture where their own business growth is more important than audit quality.
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