Commentary on Sections Part 1:  Auditors, Accounts, Directors' Liabilities and Investigations Summary and background
58.Sections 10-12 with sections 14 and 15 deal with the enforcement of accounting requirements. They strengthen the role of the person authorised under section 245C of the Companies Act 1985 to apply to the court to order a company to revise its accounts.  The person currently authorised is the FRRP.   The statutory role of the Secretary of State or the authorised person  has previously been restricted to examining companies’ annual accounts and applying to the courts to order their revision  as necessary. Sections 10-12 and 14 and 15 enhance this regime in a number of ways: by (a) providing for a prescribed body (which will be the FRRP) to be appointed to monitor aspects of accounts or reports required under Listing Rules, such as interim financial statements;  (b) providing for the authorised person and the prescribed body  (the FRRP in both cases) to have a power to obtain information in order to carry out their functions;  (c) opening an information gateway from the Inland Revenue to the FRRP.
59.In future the "Review Panel" (a body formed under the constitution of the FRRP) will be authorised under section 245C and also appointed undersection 14 to monitor aspects of accounts or reports required under Listing Rules.  It is not envisaged that any other person or body is likely to be authorised or appointed.  For that reason these notes refer to the FRRP or the Review Panel of the FRRP throughout, although the legislation itself does not name the FRRP.
60.Strengthening the role of the FRRP was a key recommendation of the Coordinating Group on Audit and Accounting Issues, one of the reviews set up by the Government in response to the financial reporting scandals in the US at companies such as Enron.  The Group reported to the Government in January 2003. The changes to the role of the FRRP also need to be seen in the context of overall changes to the Financial Reporting Council Ltd and its associated companies, of which the FRRP is one.