Audit registration

In the UK only firms who are Registered Auditors can conduct regulated audit work. These FAQS explain the specialist authorisation regime surrounding audit work.

How does my firm become a registered auditor?

If you want your firm to become a Registered Auditor, you will need to:

• Nominate an Audit Compliance Principal who is responsible for audit compliance in your firm
• Ensure that at least 50% of the voting rights in your firm are held by holders of the audit qualification
• Submit an application form for Audit Registration to ICAS.
• Submit applications for each Responsible Individual in your firm (see below)
• Submit applications for each Affiliate in your firm (see below)
• An audit registration fee is payable on application (please contact ICAS).
• Have appropriate Professional Indemnity Insurance in place.

Audit terms explained

Registered Auditor

A firm can only accept appointment as an auditor if it is a Registered Auditor. In the UK, we register firms to act as Registered Auditors, rather than individual persons. A Registered Auditor is a firm that is registered with a Recognised Supervisory Body (RSB) and is eligible to be appointed as a Statutory Auditor to undertake regulated audit work.

Each person responsible for audits and signing audit reports in the audit firm must be a Responsible Individual (RI).

Recognised Supervisory Body (RSB)

An RSB is a body that is recognised under the Companies Act for the purposes of the registration and supervision of Registered Auditors. ICAS is an RSB and registers, regulates and monitors audit firms.

Responsible Individual

Each person responsible for audit work and signing audit reports in an audit firm must be a Responsible Individual. To become a Responsible Individual, the individual must hold a Practicing Certificate and an audit qualification.

The audit qualification

The audit qualification is awarded to ICAS members, and members of other RSBs, who have demonstrated that they have achieved sufficient knowledge and supervisory experience in audit, through examination and work experience gained within an Authorised Training Office. Initially, the audit qualification was automatically awarded, however the requirements were changed by the Companies Act 1989, meaning that, since 30 September 1991, the qualification must be applied for. This is obtained through providing evidence of UK audit experience by recording of such in the ICAS logbook, including at least 210 days of UK audit experience. Individuals who held an appropriate qualification under the previous legislation are 'grandfathered in'. In the UK, if you were a member of one of the Institutes or ACCA on both 31 December 1989 and 30 September 1991 you are deemed to hold the audit qualification. Only a member holding the audit qualification counts towards the control percentage as stipulated in the Audit Regulations.

Regulated audit work

This is audit work in respect of:

• a company incorporated in the UK or ROI;
• or other entities requiring audits under legislation specified in the Audit Regulations and is reserved by law or constitution, to a 'registered auditor'.

Affiliate

Any principal in the firm who is not a member of an RSB (see above) must become an audit Affiliate. As the firm is regulated we need to ensure that all of the principals in the firm are too. We therefore require those that are not already members of an RSB (who already need to comply) to become Affiliates and sign up to our rules and regulations.

Audit Compliance Principal

Each firm needs to appoint and Audit Compliance Principal (ACP) who is responsible for ensuring that the firm complies with theAudit Regulations, Audit Guidance and Audit Regulations and Guidance. The 'Roles and Responsibilities of the Audit Compliance Principal' - a help sheet that guides you through the main responsibilities.

What is involved in the responsible individual (RI) application?

Each individual who is responsible for audit work and who signs audit reports must be a Responsible Individual for audit work: Each RI needs to

• Be a Practicing Certificate holder and hold the audit qualification.
• Submit an RI Application Form
• If the applicant has never been an RI, has not been an RI in the last three months, or has not had any audit clients in the last 12 months, submit an Audit Experience Form
• Guidance notes are available when applying for RI Status.

“We have published an updated Responsible Individual application form and Audit Experience form which much be used from 1 July 2016. This is to ensure that all parties satisfy the compliance requirements under International Education Standard (IES) 8, Professional Competence for Engagement Partners Responsible for Audits of Financial Statements.”

Downloads:

• RI Application form PDF [267 KB]
• Audit experience form PDF [225 KB]
• Additional guidance notes PDF [147 KB]

What is involved in applying to become an affiliate?

We need to ensure that all principals who are not members of a Recognised Supervisory Body are regulated by ICAS.

They need to:

• Submit an Affiliate Application Form.
• If you have a corporate body as a principal, submit a Corporate Affiliate Form application form for each corporate body.

Downloads:

• Audit affiliate application form PDF [206 KB]
• Additional guidance PDF [419 KB]
• Corporate audit affiliate application form PDF [178 KB]

What happens next?

The ICAS team will aim to process your application forms within two weeks of receiving your forms. Please note that each application requires to go through a detailed checking process including consideration of fit and proper status and, for RI applications, competence and experience. There is no automatic approval of any application, given the public interest element of audit applications and you will be notified when a decision has been made regarding your application. However, you should note that the following circumstances could delay the application:

• If you have not provided all of the information required we will contact you to request this information. This could delay your application being processed. We will let you know how this affects your application timescales.
• For less straightforward applications, the Authorisation Committee (AC) may need to consider the application (for example concerns over eligibility criteria, potential fit and proper matters notified or concerns over audit experience for applicants RIs). This may take a bit longer as the AC meets six times a year. We will let you know how this affects your application timescales.
• We are here to help. If you would like to know the status of your application at any time please contact Regulation via email at regulatoryauthorisation@icas.com.

What happens once my firm is registered?

Once you are registered there are a number of obligations that you will need to fulfil. We are here to help, so please contact us if you would like advice or support. Your firm will need to meet the following:

• Comply with the Audit Regulations and Guidance.
• Notify ICAS within ten days of any changes in the firm.
• Continue to comply with the professional indemnity insurance requirements.
• Complete a Firms Annual Return each year.
• Be monitored by ICAS Audit Monitoring.
• All Audit Compliance Principals and Responsible Individuals are now required to view the online material for the mandatory audit course, or attend a face to face course, once every 2 years (commencing from 1 September 2020).

What are the audit regulations?

All audit firms, Responsible Individuals and audit staff are required to comply with the Audit Regulations & Guidance.

The Audit Regulations can be found on the ICAS Rules & Regulations page.

Are you changing the legal status of your firm?

If your firm is changing legal status (for example incorporating or becoming an LLP) you will need to submit a new application form for Audit Registration. You will no longer need to submit an RI application form or an Affiliate application form for any existing RIs and Affiliates transferring over from the old firm to the new firm. Any new RIs or Affiliates would need to complete an application form.

How to access the public audit register

The Register of Statutory Auditors contains information on Statutory Auditors and Audit Firms in the UK.

The following information is available on this Register:

• Contact details for all Recognised Supervisory Bodies (RSBs) and details of firms registered by them.
• Details of Audit Registered Firms, who registers them and the individuals linked to them.
• The full address of the registered firm, the RSBs and the individual details.

The Register can be accessed at the Audit Register Website

How do I complain?

If you are not happy with the service you have received from us in respect of your applications please contact us by telephone at 0131 347 0100 or emailing us at members@icas.com.

What happens if my application is denied?

If your application is denied:

• You will be notified of the reason for this denial.
• If you are unhappy with this decision, concerns should be notified in writing to the Director of Regulatory Monitoring in the first instance and this will be considered by the Authorisation Committee (AC).
• If you are dissatisfied with the ACs decision, there is an Independent Review and Appeals process, which is explained in Chapter 8 of the Audit Regulations.

The Audit Regulations can be found on the ICAS Rules & Regulations page.

The EU Service Directive and The Provision of Services Regulations

In accordance with the requirements of the EU Services Directive, which was brought into UK law by The Provision of Services Regulations 2009, information is available about the rules, regulations and formalities that apply to service activities in other EU countries. This information can be found through Points of Single Contact (PSCs), which are online e-government portals. Guidance is available on the UK Government's website.

Mandatory Course Obligations and support

ICAS helps your firm run a compliant audit practice. The ICAS Audit Monitoring team support this approach in the following ways:

• The mandatory audit course: Keeping Audit on the Right Track
  This course aims to educate Audit Compliance Principals (ACPs) and Responsible Individuals (RIs) in developing a strong compliance function and preventing some of the recurring issues identified on audit monitoring visits. A video recording of the course will be available on the website. This will be free for members to access any time they wish. This online recording will be split into around 6-10 parts. Should members prefer to attend a face to face course, it is intended that 3 courses will be run each year, in Edinburgh, Glasgow and Aberdeen. The course is open to all audit professionals and many attend yearly to maintain audit CPD, however, there is a mandatory requirement:
  • All ACPs and RIs are required to view the online material, or attend a face to face course, once every 2 years (commencing from 1 September 2020).
  • Newly approved RIs will be required to attend the course within 12 months of approval; and
  • Previously inactive RIs (i.e. approved RIs who are not signing audit reports), who have recommenced the role, will be required to attend the course within 12 months of becoming active.

  The course is presented by the ICAS Audit Monitoring team and has been created to educate and support ACPs and RIs and covers all areas of audit compliance responsibilities, key regulatory issues, common compliance failings, and key findings from ICAS audit monitoring visits. Detailed materials are provided during the course, and this is useful reference material for all firms.

  Contact us

  Any enquiries regarding Audit Registration should be emailed to us for further assistance.

  

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