The audit committee
The audit committee

The following Corporate practice note provides comprehensive and up to date legal information covering:

  • The audit committee
  • Regulatory framework
  • UK Corporate Governance Code
  • Listing Rules
  • Disclosure Guidance
  • EU Audit Regulation and Statutory Audit Amending Directive
  • Statutory Services Order
  • FRC Guidance on audit committees and related matters
  • The Chartered Governance Institute guidance and model terms of reference
  • Audit Committee Institute
  • More...

The UK Corporate Governance Code (UKCG Code), which is issued and administered by the Financial Reporting Council (FRC) is the benchmark for good governance of listed companies. The UKCG Code requires listed companies to establish an audit committee and includes a number of recommendations regarding the composition, role and responsibilities of the committee.

This Practice Note looks at these requirements as well as other regulatory requirements and best practice guidance.

For commentary, guidance, analysis and materials on the UKCG Code requirements on the audit committee, see Resource Note: 2018 UK Corporate Governance Code—Section 4—Audit, risk and internal control.

Regulatory framework

UK Corporate Governance Code

In July 2018, the FRC published a revised version of the UKCG Code, which applies to premium listed companies with accounting periods beginning on or after 1 January 2019 (although companies could choose to comply with some or all of the provisions before this date). The FRC also published an updated Guidance on Board Effectiveness.

For general information on the application, purpose and provisions of the UKCG Code, see Practice Note: The UK Corporate Governance Code.

Listing Rules

All premium listed companies are required under the Listing Rules (Listing Rules) of the Financial Conduct Authority (FCA) either to comply with the provisions of the UKCG Code or to explain to shareholders in their next annual report why they have not done so (the 'comply or explain' principle).


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