UK audit companies urge FRC to stop public probe announcements

Core Viewpoint - Large audit networks in the UK, including Deloitte, EY, KPMG, and PwC, are advocating for the Financial Reporting Council (FRC) to cease the routine naming of companies under investigation, citing concerns over the impact on business activity and the potential for indirect identification of individual partners [1][5]. Group 1 - The FRC has been urged to stop naming companies under investigation, with major audit firms and mid-tier companies participating in discussions to file complaints regarding the current publication approach [1][2]. - The FRC's investigation announcements typically include details such as the auditor, client, and audit period, which can lead to the identification of engagement partners [3]. - There is a suggestion within the audit profession to limit identification to cases of serious wrongdoing or to name companies only after investigations conclude [3][4]. Group 2 - The industry has proposed that the FRC could omit the names of audited companies to reduce the risk of indirect identification of individual partners [4]. - The FRC has acknowledged the engagement from the industry but has refrained from commenting on the consultation responses until they are submitted [4]. - The Financial Conduct Authority (FCA) previously decided against expanding the practice of naming companies under investigation due to strong opposition from the financial sector, indicating a broader concern about the implications of such practices [4][5].