The Financial Reporting Council (FRC) has launched a market study examining how effectively the audit market serves small and medium-sized enterprises (SMEs) and exploring opportunities to reduce their reporting burden where possible.

This study is the first phase of the FRC’s broader campaign to support UK SMEs to access audit services and secure the capital they need for growth.

While audited accounts often play a crucial role in helping SMEs secure the capital they need to scale, creating wealth and jobs, the FRC is aware of concerns about the availability and cost of audit services for these businesses.

The study will also look at how auditing standards are interpreted and applied to this segment of the market, as well as reporting challenges which SMEs may be experiencing.

This market study will help the FRC identify challenges which SMEs are currently experiencing, including any reporting and audit burdens, and help inform its guidance to both audit practitioners and SMEs.

The FRC is inviting all interested parties to submit comments and evidence on the SME market study by 25 April 2025. The market study is expected to conclude before the end of 2025.

ACCA would be keen to hear from members in the SME audit sector and welcome your feedback and comments which can be sent to our policy team at ukpolicy@accaglobal.com.

Find out more about the FRC study