28 September 2010
FSA to crackdown on inadequate audit reports
The Financial Services Authority (FSA) has announced that it is to take measures in order to increase its role in improving the overall standard of the reports posted by auditors on client assets.
FSA investigations into the quality and consistency of such documents have revealed several "serious failings" in the sector due to a general level of poor practice in terms of auditors properly applying FSA regulations to their reports across the majority of their client assets, which could then lead to these organisations being in breach of the law.
Consequently, the regulatory body - which was granted its powers under the remit of the Financial Services and Markets Act 2000 - has decided to attempt to stop this from happening in the future.
Richard Sutcliffe, client assets sector leader at the FSA, commented: "We have repeatedly emphasised the importance of firms segregating client money and assets effectively."
He added that the body had also "made clear our disappointment" in the low standard of auditors reports it had scrutinised.
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Posted by Richard Saunders