Recognising the increasing role of artificial intelligence (AI) in driving audit innovation and quality, the Financial Reporting Council (FRC) has published its first guidance on AI in audit. Released alongside a thematic review, the guidance examines how the UK’s six largest audit firms assess and certify the use of emerging technologies in their audit processes.

Rather than focusing on individual tools, the guidance presents a structured framework for introducing AI-enabled solutions, outlining clear expectations for documentation and regulatory compliance. Its goal is to support the responsible and consistent integration of AI across the profession, while encouraging continued technological development.

Developed with contributions from the FRC’s Technology Working Group and audit industry experts, the guidance is designed to help audit teams and central functions within firms adopt AI tools effectively. It also informs third-party technology providers of the regulatory standards their products must meet to be used in audits.

The thematic review provides insights into how firms validate and approve automated tools, highlighting good practices and key findings from internal certification processes—critical elements in upholding audit quality.

FRC Executive Director of Regulatory Standards, Mark Babington, commented on the release:

“AI tools are moving from pilot stages to real-world use in audit. When used responsibly, they offer the potential to improve audit quality, strengthen market confidence, and support innovation—ultimately contributing to UK economic growth. This guidance sets out the FRC’s expectations for how AI should be applied and documented appropriately. As this area continues to evolve, we remain committed to supporting the profession and engaging both domestically and internationally to ensure AI’s effective and responsible integration.”

Full info obtained here