Imagine you are running a private limited company and managing its affairs. You have an auditor and are planning to reappoint them. Suddenly, you realise that your company is now classified as a “Public Interest Entity” (PIE), and your current auditor is not registered with the Financial Reporting Council (FRC). Consequently, this auditor is not authorised to audit your company.
This situation can arise for any company that meets the criteria established by the FRC for PIE classification. These criteria have undergone several revisions over the years. Indeed, as per a notice bearing reference number ১৭৪/এফআরসি/প্রশা/২০২৫/৭৫৪, the FRC has observed a concerning trend: auditors and audit firms not enlisted with the Council are continuing to provide audit services to various PIEs.
The FRC issued a stern notice, dated 10 February 2025, reminding all PIEs, auditors, and audit firms of the strict prohibitions against engaging unregistered auditors for PIE audits. This directive emphasises compliance with the Financial Reporting Act, 2015, particularly Sections 31, 34, and 48, and signals a renewed focus on upholding audit quality and regulatory adherence in Bangladesh.
The notice, bearing reference number ১৭৪/এফআরসি/প্রশা/২০২৫/৭৫৪, highlights a critical provision of the Financial Reporting Act, 2015. Specifically, Section 31 of the Act mandates that auditors or audit firms not enlisted with the FRC are barred from conducting audits of “Public Interest Entities” as defined in Section 2(8) of the same Act.
Therefore, before appointing any auditor, companies are required to verify whether they are considered a PIE. If so, they must appoint an auditor registered with the FRC.