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UK review of actuarial regulation

The UK government is preparing to publish a draft bill later in 2025 that impacts actuarial regulation. 

Background 

In 2018, the UK government commissioned several independent reviews into audit and corporate governance. This arose due to concerns around the quality of UK company audits, particularly following high-profile corporate collapses such as Carillion and BHS. 

One of these independent reviews was undertaken by Sir John Kingman, looking at the Financial Reporting Council (FRC). Currently, the FRC is responsible for the independent oversight of the IFoA’s regulatory role, underpinned by a memorandum of understanding.

Legislation to address audit and corporate governance reform has been expected since the UK government published a consultation in March 2021 on restoring trust in audit and corporate governance. The government’s consultation response, published in May 2022, made a series of recommendations on the oversight and regulation of the actuarial profession, namely:

  • FRC’s successor body, the Audit, Reporting, and Governance Authority (ARGA), should be given statutory powers to oversee and regulate the actuarial profession.
  • ARGA’s regulatory responsibility will be focused primarily on individuals who undertake public interest actuarial work.
  • ARGA should have the statutory power to set technical actuarial standards for IFoA members, concerning their actuarial work, including their non-public interest work, for individuals or entities. 

Draft Audit Reform and Corporate Governance Bill

Policy proposals based on the government’s consultation response are now expected to be introduced through a Draft Audit Reform and Corporate Governance Bill. The government announced its intention to introduce this bill in the King’s Speech in July 2024. 

Working with the IFoA Council’s Regulatory Strategy Steering Group, the IFoA has been engaging with government, the FRC and other stakeholders on this review since 2018 to help shape the future regulatory framework on behalf of members.