What counts as practical audit experience?
The Companies Act 2006 sets out what we can accept as practical audit experience, and the UK regulator, the Financial Reporting Council has further clarified this in the interpretations below.
Statutory audit work
The basic definition is work undertaken on the statutory audit of UK companies.
However, the Act allows for the recognition of some overseas company audit work ‘where it appears to the Financial Reporting Council (FRC) that the law and practice [of a country or territory outside the United Kingdom] with respect to the audit of company accounts is similar to that in the United Kingdom.’ The judgment required by FRC relates to the territory as a whole, rather than to any specific audit work performed.
It has been generally accepted that law and practice in the ROI is similar for this purpose. Additionally it has been confirmed that the law and practice with regard to audit in Germany, Cyprus, Luxembourg and the Netherlands was similar. There is no approval in respect of law and practice of any other countries.
Other audit work
Other audit work similar to company audit work includes:
The audit of other entities (whether in the UK or not) by registered auditors or by Auditors General, (as defined by the Companies Act 2006), in accordance with Statements of Auditing Standards, International Standards in Auditing (UK and Ireland) or International Standards in Auditing.
The audit of other entities (whether in the UK or not) in accordance with Statements of Auditing Standards, International Standards in Auditing (UK and Ireland) or International Standards in Auditing by auditors who are authorised by a recognised qualifying body in the UK for training purposes; [or in another member state post the implementation of the 8th Directive] such work should be supervised by a person holding a recognised qualification.
Other audit work agreed by the recognised qualifying body and FRC as being similar to company audit work.
If in any doubt you should document the experience within the application form narrative, any questions will be clarified with applicants during the processing of the application.