The National Audit Office will audit the FSA from the 2010/11 financial year.
Speaking in the House of Commons recently, Treasury Exchequer Secretary Sarah McCarthy-Fry said: “The NAO has a valuable role to play in delivering transparency and accountability so I am pleased to announce that the FSA has decided to appoint the comptroller and auditor general as its financial auditor from the next financial year, 2010/11.
“That will enable the public accounts committee to receive and investigate reports into aspects of the economy, efficiency and effectiveness of the FSA’s performance. I welcome that decision and believe it can only enhance the FSA’s standing and enable it to show how well it discharges its business.”
Aifa director general Chris Cummings welcomes the move and says it is important that the FSA is accountable for its costs.
He says: “With a budget that has rocketed to nearly half a billion pounds a year, it is critical that the FSA is held to account. We have always said that, as a statutory body, FSA must be more transparent and clearly demonstrate value for money.
“The appointment of the NAO ensures that the public accounts committee can fully scrutinise FSA’s performance on a regular basis.”
Adviser Alliance director Alan Lakey says he is generally optimistic about the appointment but warns that the audit will need to take account of the current regulatory environment.
He says: “The NAO will need to check whether the regulator offers value for money and makes good use of its resources, but the right questions also need to be asked in relation to the current regulatory environment and whether the changes being forced upon IFAs are econom- ically viable.”