The Financial Reporting Council oversees the accountancy bodies in two different ways: as the statutory Competent Authority for audit, it recognises and supervises the bodies that register and monitor auditors, and by voluntary agreement it oversees how the six chartered bodies regulate their other members. Anti money laundering supervision is overseen separately, by OPBAS within the Financial Conduct Authority, which covers a wider group of bodies including AAT, CIOT and the bookkeeping institutes.

Who regulates the accountancy bodies?

Accountancy is largely self regulated. The FRC’s own complaints guidance says the accountancy profession has no statutory framework governing its regulation in general, and that the professional bodies directly regulate their individual and firm members, including their conduct. Above the bodies sit different overseers depending on the activity:

Activity Front line regulator Overseer
Statutory audit Recognised Supervisory Body (ICAEW, ACCA, ICAS or Chartered Accountants Ireland) FRC, under statute
Other work by members of the six chartered bodies The member’s body FRC, by agreement
Anti money laundering supervision Professional body supervisor, or HMRC OPBAS for the professional bodies

For a practice, the overseer rarely appears directly. Its influence shows up in what the body’s monitoring visits test, how the body handles complaints, and how firmly it disciplines.

How does the FRC oversee audit regulation?

Since 17 June 2016 the FRC has been the Competent Authority with ultimate responsibility for audit regulation, under regulation 3(1) of the Statutory Auditors and Third Country Auditors Regulations 2016 (SATCAR 2016). It recognises professional bodies as Recognised Supervisory Bodies (RSBs), which register and supervise audit firms, and as Recognised Qualifying Bodies, which award the audit qualification. The requirements for RSBs are in Schedule 10 to the Companies Act 2006, and for qualifying bodies in Schedule 11. There are currently four RSBs: ACCA, Chartered Accountants Ireland, ICAEW and ICAS.

The FRC delegates some regulatory tasks to each RSB under a Delegation Agreement: registration, audit monitoring of non public interest entity audits, continuing professional development and enforcement for non public interest entity work. It cannot delegate tasks relating to audits of public interest entities, which it carries out itself through its audit quality reviews and enforcement. A direction effective from 31 July 2022 gave the FRC greater power to decide what to delegate and to reclaim tasks, whether individual cases or whole categories of work.

The FRC’s Professional Bodies Supervision team, renamed from the Professional Oversight Team with effect from 1 June 2023, assesses periodically whether each RSB still meets the recognition requirements and performs the delegated tasks properly. Its statutory powers include recognising and derecognising RSBs and qualifying bodies, requiring information, serving an enforcement order and imposing a financial penalty on a body that fails to meet its statutory responsibilities. It reports annually to the Secretary of State on this work. The Association of Authorised Public Accountants appears on the FRC’s list of derecognised RSBs, which shows recognition is not permanent.

What about accountants who do not audit?

For work outside statutory audit, the FRC’s role is non statutory. By agreement with the six chartered accountancy bodies (ACCA, Chartered Accountants Ireland, CIMA, CIPFA, ICAEW and ICAS) it oversees how those bodies regulate members beyond those who are statutory auditors. For all of them except CIMA, that oversight rests on a 2003 exchange of letters between the FRC and the Consultative Committee of Accountancy Bodies.

Because this is voluntary, the FRC cannot order a body to change its rules for general practice. Instead, the CCAB bodies and CIMA have committed to consider FRC recommendations carefully and either implement them within a reasonable period or give written reasons for not doing so. The FRC notes that its audit oversight is also relevant to accountants more generally, because the bodies’ regulatory systems often apply to both.

The same six bodies are members of the FRC’s Accountancy Scheme, under which the FRC itself investigates misconduct by members and member firms in public interest cases. Ordinary conduct cases stay with the body, for example through the ICAEW disciplinary process. How the Scheme works is covered in our guide to the FRC enforcement procedure.

Which bodies fall outside FRC oversight?

Several bodies whose members run practices are not among the six chartered bodies, including the Association of Accounting Technicians, the Chartered Institute of Taxation, the Association of Taxation Technicians, the Institute of Financial Accountants, the Institute of Certified Bookkeepers and the Institute of Accountants and Bookkeepers. The FRC has no general oversight of how they regulate members. All of them, however, are listed in Schedule 1 to the Money Laundering Regulations 2017 as professional body supervisors, so their AML supervision is overseen by OPBAS.

Where does OPBAS fit?

The Office for Professional Body Anti Money Laundering Supervision (OPBAS) is housed within the FCA and oversees the professional body supervisors in the legal and accountancy sectors. Its remit is AML only: it does not oversee any professional body function unrelated to AML supervision, does not supervise individual firms or accountants, and does not oversee statutory supervisors such as HMRC. So an ICAEW firm sits under two overseers at once: the FRC for audit regulation and general professional oversight, and OPBAS for the quality of ICAEW’s AML supervision. A firm supervised for AML by HMRC is outside OPBAS’s remit altogether. Our page on OPBAS and professional body AML supervisors explains its powers, and AML supervision reform covers the planned move of AML supervision to the FCA.

Can the FRC help with a complaint about my professional body?

Only in a limited way. The FRC says a complaint about an accountant should go first to the accountant or firm and then to their professional body. If the complainant disagrees with the body’s outcome, they can ask the FRC to review the body’s handling of the complaint, but the FRC is not a route of appeal and cannot overturn the decision or require the body to reconsider. Complaints to the FRC should be made within 12 months of the conduct, or of becoming reasonably aware of it, and the FRC aims to say within 5 working days whether it can look at the matter. Separately, the FRC will consider a complaint that meets the public interest test for the Accountancy Scheme. For the body level process, see complaining to a professional body.

How does this affect a small practice?

Illustration only. A three partner ICAEW firm audits a handful of small companies and provides accounts and tax work to several hundred clients.

  • Its audit registration and audit monitoring visits come from ICAEW, performing tasks delegated by the FRC. If the FRC found ICAEW’s monitoring too light, it could reclaim the task or require changes, and the firm would feel that through tougher visits.
  • Its non audit work is monitored by ICAEW under the practice assurance scheme. FRC influence here works through recommendations ICAEW has committed to consider.
  • Its AML supervision also comes from ICAEW, and the standard ICAEW applies is shaped by OPBAS findings rather than by the FRC.

An AAT licensed bookkeeper down the road has no FRC link at all, but its AML supervisor is still overseen by OPBAS.

What do people commonly misunderstand?

  • Thinking the FRC regulates all accountants. Its statutory role is audit; its wider role covers members of six bodies by agreement only.
  • Expecting the FRC to reopen a body’s complaint decision. It reviews handling, not outcomes.
  • Assuming OPBAS supervises firms. It supervises the supervisors.
  • Treating FRC audit inspections and RSB monitoring as the same thing. Public interest entity audits are inspected by the FRC; other audits by the RSB under delegation.

Solar Protect runs fee protection schemes for accountancy and bookkeeping practices. See how our accountant schemes work or read fee protection schemes for accountants.

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Sources

Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 19 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.