Industry Regulator Statement

Notes to editors:

1. The Financial Reporting Council (FRC) is the UK's independent regulator responsible for promoting high quality corporate governance and reporting to foster investment. The FRC sets the UK Corporate Governance and Stewardship Codes and UK standards for accounting and actuarial work; monitors and takes action to promote the quality of corporate reporting; and operates independent enforcement arrangements for accountants and actuaries. As the competent authority for audit in the UK the FRC sets auditing and ethical standards and monitors and enforces audit quality.

2. To meet its responsibility as the competent authority in respect of audit enforcement, the FRC operates the Audit Enforcement Procedure. This procedure applies to the investigation and sanctioning of breaches of the various requirements of the statutory auditors of Public Interest Entities (PIEs) and any other cases retained by the FRC including AIM companies with a market capitalisation in excess of €200m. In brief, the stages of the Audit Enforcement Procedure are:

· Initial case examination and decision to investigate

· Investigation

· Decision by Executive Counsel as to whether to issue a Decision Notice (a notice with the findings and recommended sanction);

· Referral to Enforcement Committee and decision by the Enforcement Committee whether to issue a Decision Notice ; and

· Referral to a Tribunal.

In order for a matter to be referred for investigation by the FRC's Executive Counsel under the Audit Enforcement Procedure, the FRC's Conduct Committee is required to decide whether there is good reason to investigate an Allegation in relation to a Statutory Auditor and/or a Statutory Audit Firm.

Investigations are conducted by Executive Counsel and the Enforcement division.

3. All Press enquiries should be directed to:

· Peter Timberlake, Head of Communications, on telephone: 020 7492 2397/ 07768 502332, or email: [email protected].

· Rita Carolan, Communications Manager, on telephone: 020 7492 2307/ 07428 149096 or email: [email protected].

· Alana Sinnen, Communications Manager, on telephone: 020 7492 2395/ 07949 005526 or email: [email protected].