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Audit reform and the BEIS

Sir Jon Thompson and Michael Izza discuss aspects of the BEIS White Paper on Restoring Trust in Audit and Corporate Governance, including audit supervision, joint audit and proposals for a professional body for corporate auditors.

Audit has been under the spotlight for the past few years, after Carillion’s failure in 2018 led to a number of inquiries (see Audit reform history). After considering the outputs, in March 2021 the UK government’s Department for Business, Energy and Industrial Strategy (BEIS) published a White Paper Restoring Trust in Audit and Corporate Governance and launched a consultation.

It sets out government plans to address the findings of each review, with new measures in relation to auditors, audit firms, directors, shareholders and the audit regulator. At 220 pages, with 98 questions and 155 recommendations, there is nothing small about the paper, its scope, or its aims. It has the potential to be as significant as the Companies Act 2006 and the Cadbury Report in 1992.