Governance Briefing — FRC Minimum Standard for FTSE 350 audit committees
From 1 January 2025 FTSE 350 audit committees must comply with the FRC’s Minimum Standard, formalising board oversight of auditor appointments, risk reporting, and assurance procurement.
Executive briefing: The Financial Reporting Council’s Minimum Standard for Audit Committees and External Audit becomes mandatory for FTSE 350 companies with financial years beginning on or after 1 January 2025. Audit committees must run transparent tender processes, challenge auditor independence, oversee risk and internal control reporting, and coordinate assurance across sustainability disclosures. The standard elevates governance expectations that had previously been voluntary under the Guidance on Audit Committees.
Key governance signals
- Auditor tender discipline. Committees must document assessment criteria, shareholder engagement, and board recommendations for auditor appointments and retenders.
- Risk reporting stewardship. The standard requires committees to monitor principal risk disclosures, viability statements, and emerging risk reporting quality.
- Assurance coordination. Audit committees are accountable for integrating financial and non-financial assurance, including ESG and sustainability reporting.
Action checklist
- Update committee terms of reference, calendars, and skills matrices to reflect the Minimum Standard’s detailed responsibilities.
- Review auditor tender playbooks, independence assessments, and contingency plans ahead of the next rotation or extension decision.
- Align sustainability assurance, internal audit plans, and external audit scoping so combined assurance supports upcoming CSRD and UK listing disclosures.
Enablement moves
- Deploy evidence trackers capturing meeting minutes, challenge logs, and follow-up actions to demonstrate oversight to investors and the FRC.
- Run board education sessions covering the new standard, regulator inspection themes, and expectations for audit committee reporting.
- Integrate auditor performance dashboards, fee analyses, and independence monitoring into quarterly committee packs.
Sources
- FRC press release — Minimum Standard for FTSE 350 audit committees
- Minimum Standard for Audit Committees and External Audit
Zeph Tech equips FTSE 350 audit committees with tender governance tooling, assurance integration roadmaps, and disclosure templates ahead of the 2025 compliance date.