Transparency Statement
THE FIRM
French Duncan LLP was one of the very first LLPs registered in Scotland following the enactment of the Limited Liability Partnership Act 2000. The LLP acquired the business of French Duncan in 2005. There are currently 20 members, or partners.
The firm is owned by its members whose rights and responsibilities are set out in the Members Agreement. The management of the firm is carried out by the Managing Partner and the Management Board all of whom hold office for a 3 year period. The Managing Partner reports to members every three months at a meeting of all members and once a year makes a formal presentation to all employees on the firm’s activities and progress. Departmental meetings between staff and their related partners take place throughout the year.
The firm operates from six offices across central Scotland providing professional services in the principal areas of audit, accountancy, taxation, corporate finance, corporate recovery and insolvency.
The firm is a member of Prime Global, a worldwide association of independent accountancy firms Prime Global is not a network as currently defined by either European or IFAC regulations and legislation.
French Duncan LLP is authorised by the Institute of Chartered Accountants of Scotland (ICAS) to carry out audit work and as such is subject to oversight by the Institute’s Audit Monitoring Unit (AMU). Additionally the firm is also subject to inspection by the Audit Inspection Unit (AIU) which is part of the Public Oversight Board, which in turn is part of the Financial Reporting Council. In the course of 2011 the firm was subject to inspection by both the AMU and the AIU. The AMU and AIU reports were finalised in May 2011.
On an annual basis the firm employs external consultants to carry out a sample review of the firm’s audit files and any recommendations arising therefrom are brought into practice. The review process ensures that every year all audit partners will have been subject to external review and particular emphasis is given to those partners whose work involves high risk or public interest clients. In addition the firm conducts regular internal reviews of files to ensure standards are maintained. The Management Board are confident that this review process is an effective method of ensuring the maintenance of audit quality.
French Duncan LLP’s insolvency partners are licensed by either ICAS or IPA. Accordingly, their work is subject to regulation and monitoring by their respective professional bodies.
Finally, all of the firm’s professional work aside from audit and insolvency is subject to regular review by the Quality Review department of ICAS. Their last inspection visit was in 2009.
RESPONSIBILITY FOR QUALITY
Aside from the firm’s Management Committee referred to above, the firm has established partners responsible for the quality of work in each of the principal areas of practice.
The audit department is the responsibility of the Head of Audit and the Audit Compliance partner. They are responsible for ensuring the use of appropriate methodology and adherence to auditing standards, overseeing the provision of relevant continuing professional education and the maintenance of technical libraries, the provision of technical advice and assistance and generally ensuring that the firm continues to provide high quality audit work.
The Audit Compliance partner evaluates the firm’s quality control procedures on an annual basis, reviews the feedback on external quality reviews and ensures implementation of best practice as this develops. The firm’s ethical standards are contained in the firm’s manual which is available to partners and staff via the firm’s intranet. The Audit Compliance partner requires an annual declaration from all partners and staff that they are aware of the firm’s ethical standards which includes confirmation of independence and that they are compliant therewith.
To further ensure the highest technical and ethical standards the firm has a Technical & Ethical Committee whose two permanent members are the Audit Compliance partner and a senior tax partner with particular skills in professional ethics, supported by other partners as circumstances demand. Any partner or member of staff is entitled to make representation to the committee where they believe a technical or ethical issue requires independent review.
MAINTENANCE OF SKILLS
For many years the firm has had in place an ongoing training programme which is designed to be relevant to personnel at each stage of their professional career.
All audit staff and partners are required to attend a series of training courses spread across each year which are provided by the same external consultants who carry out the annual audit file reviews. As well as ensuring that staff and partners are technically up to date, this approach is also intended to ensure that any weaknesses identified in the file review process are addressed at an early date by way of a training course.
In addition all professional staff and partners are encouraged to attend other training courses which are considered relevant to their line of work or specialism.
All staff are subject to a yearly appraisal process which further helps to identify professional development needs.
MANAGEMENT STATEMENT ON EFFECTIVENESS OF FUNCTIONING
The firm’s Management Committee believes that the policies, regulations and procedures outlined above have ensured that in all material respects partners and staff have complied with relevant professional, regulatory and legal requirements. This compliance has ensured a consistently high quality of work across the practice.
Public Interest Entities
UK listed audit clients:
J. Smart & Co (Contractors) plc.
Financial Information
2012 2011
£’000 £’000
Audit income 1,319 1,850
Other professional income 6,700 5,971
Total 8,019 7,821
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PARTNERS’ REMUNERATION
Profits are shared amongst partners in accordance with a formula which is reviewed every three years. Depending upon the level of an individual partner’s capital account, he or she is entitled to either a fixed tranche or a fixed first tranche and a variable second tranche calculated in accordance with the formula. Partners admitted during the period of the three year formula are remunerated on the basis of separate negotiation. The formula takes account of, amongst other things, levels of client responsibility, management responsibility, technical skills and seniority. The remuneration of audit partners is not related to the provision of non-audit services to their audit clients.
FRENCH DUNCAN LLP