PRA has published a policy statement setting out:
- feedback and links to final rules on engagement between external auditors and supervisors and giving PRA disciplinary powers over external auditors and actuaries;
- an associated supervisory statement on written reports by auditors to PRA;
- a new statement of policy on the imposition and amount of financial penalties on auditors and actuaries of PRA-authorised persons; and
- an amendment to PRA’s statement of policy on statutory notices and the allocation of decision making which relates to the exercise of disciplinary powers over auditors and actuaries.
PRA has incorporated its new and amended statements of policy in the updated Statement of Policy on PRA’s approach to enforcement. The requirement for written auditor reporting to PRA applies to the external auditors of the largest UK-headquartered deposit-taking institutions that are not subsidiaries of non-UK firms. This means those with a balance sheet total greater than £50 billion at individual or consolidated group level. The regime will start during the audit cycle for financial reporting periods ending on or after 1 November. (Source: PRA Publishes External Auditors Engagement Policy and PRA Updates Approach to Enforcement)