UK Audit Regulator Overhauls Supervisory Model to Boost Quality and Resilience

The UK Financial Reporting Council (FRC) has launched a new supervisory model for audit firms, shifting focus from individual audit checks to a more holistic review of firms' Systems of Quality Management (SoQM). This move, driven by past corporate scandals and government pressure, aims to enhance audit quality, reinforce market resilience, and restore public trust in financial reporting. Internal audit professionals should note this shift towards systemic quality management, as it signals a broader regulatory expectation for robust internal controls and oversight within audit practices, potentially influencing their own organizations' approaches to assurance and governance.