FRC CASS consultation 2019
21 October 2019
PwC have submitted feedback to the recent consultation on changes to the FRC Client Assets (“CASS”) Assurance Standard . From our experience, we consider that the Standard has contributed to a significant improvement in the quality and consistency of CASS audits. We also believe that the application of the Standard has contributed to a significant improvement in the understanding and documentation of control processes within regulated firms. However, in order to provide a more effective framework to improve audit quality, to support CASS auditors and to underpin the disciplinary process, we believe the FRC can further improve the clarity of some of the proposed requirements.
We generally agree with the changes made by the FRC, and have provided additional feedback in a number of areas, including the use of Internal audit and reliance on SOC reports; and extending the reporting requirements to those charged with governance.
However, the FRC stated in their Impact Assessment that they are proposing ‘no changes to audit scope’. We are concerned that as currently drafted the changes do risk extending the CASS audit scope in the following areas (with a consequent increase in the cost to regulated firms):
Assurance on the completeness of the firm’s record of breaches; and
Implications of applying an ‘insolvency mindset’.