According to the body, a review into auditing practices found that many firms and organisations failed to meet the FSA requirements when evaluating their client assets.
In a review of the industry, the regulator found numerous issues including how many auditors were unaware of reporting requirements while a number of reports have been submitted late or contained errors such as incorrect dates or without any signatures.
Richard Sutcliffe, FSAâs client assets sector leader, said: âWe have also made clear our disappointment in the quality of auditorsâ reports that we have reviewed.
âIt is ultimately a firmâs responsibility to ensure that they have adequate systems in place, but they, as we, rely on their auditors to provide the necessary assurance in this regard. Auditors charge a fee for this professional service - it is important that we and firms can rely on the reports they are signing off.â
As a result of the review, the FSA has issued a consultation paper containing proposals to ensure improvements to auditing sector standards.
Recommendations included ensuring reports are consistent and confirming the standards that firms need to adhere to.
By Jim Ottewill