The UK’s Financial Reporting Council (FRC) and the Australian Securities and Investment Commission (ASIC) have announced a memorandum of understanding on reciprocal arrangements (MOURA) making it easier for auditors to work between both countries.
The agreement allows auditors who have obtained professional audit qualifications as a statutory auditor in either the UK or Australia to more easily apply for recognition of their qualification and audit rights in the other nation.
It will improve the quality of the UK audit market by increasing the number of skilled statutory auditors able to practise in the UK over time and make it easier for UK audit firms to export their services to Australia.
The accounting activities sector, which includes audit services, is a significant part of the UK economy, generating £44bn in 2023. The sector supported over half a million jobs and accounted for nearly £4bn of exports in 2022.
The FRC assessed the relevant Australian qualifications as equivalent to UK audit qualifications, including utilising an independent external expert. This work was made possible thanks to funding through the Department for Business and Trade (DBT)’s Recognition Arrangements Grant Programme. The scheme is part of the government’s support for UK regulators and professional bodies in all sectors to develop recognition arrangements.
The UK and Australia signed a free trade agreement which came into force in May 2023. This agreement included a chapter on the recognition of professional qualifications, encouraging regulators to pursue recognition agreements such as this one to remove costly and burdensome requirements.
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By GlobalDataSimilar audit arrangements have recently been signed with New Zealand and Switzerland and the FRC is continuing to explore other agreements subject to rigorous qualification standards being met.
Commenting on this, FRC executive director of supervision, Sarah Rapson, said: “Australia is a key trading partner for the UK and this agreement further strengthens our close relationship by opening new opportunities for audit firms and UK businesses to grow and expand.
“It is a positive boost for the UK audit market, widening the pool of talent available to UK audit firms and further enabling firms to export their audit services and improve the quality of their audits.”
UK trade policy minister, Greg Hands, added: “The UK is the world’s second largest services exporter for a reason. Countries around the world want excellent British services, so it is vital that we make it as easy as possible for UK professionals to sell those services around the world.
“I am delighted that our trade deal with Australia and the Department’s grant programme have supported the FRC in making this arrangement, helping British audit professionals to access the lucrative Australian market.”
