Commentary Part 4– Eligibility and Regulation of Local Auditors Paragraph 28: Recognised supervisory bodies
62.This paragraph provides for general modifications to Schedule 10 to the Companies Act 2006 in relation to the responsibilities of recognised supervisory bodies, and in particular to specify the experience and training needed by those people carrying out inspections of local audits and in monitoring the quality of local audits undertaken by their member firms, including an additional level of oversight for audits of significant local bodies. Sub-paragraph (7) provides the Secretary of State with regulatory powers to set out which bodies would have their audits defined as ‘major local audits’, which would then be subject to this additional level of oversight by the Financial Reporting Council. Recognised supervisory bodies must also comply with guidance issued by the Secretary of State on the appropriate level of competence of auditors.