2.12 The Audit Committee report does not say when the audit was last tendered or what the retendering plans are
UK Company A · a UK-listed medical technology group · Regulator-style question
In brief
The Audit Committee report says [audit firm] has been auditor from [date] and that the Committee complied with [wording masked]. The Standard, which the 2024 UK Corporate Governance Code (the Code) Provision 26 brings into the annual report, asks the report to say when a tender was last conducted and to give advance notice of retendering plans. The 2025 report gives neither; the 2024 report said only that [audit firm] was appointed after a competitive tender, without the year. Because the next mandatory dates follow from law, this is put as a question.
The evidence, as filed
Screenshot withheld to protect the company’s identity: Annual Report 2025, page 144; Annual Report 2024, page 133; Annual Report 2025, page 100; Annual Report 2025, page 142. Their wording or layout could lead back to the company even with names and figures masked; the evidence list below records what each page shows.
What the report shows, and what the rule requires
| What the annual report shows | What the rule requires |
|---|---|
| What the annual report shows Tenure given ([audit firm] auditor from [date], second audit in 2025) and a statement of compliance with the Minimum Standard; no year of the last audit tender and no statement of retendering plans anywhere in the report. | What the rule requires A sentence such as: 'The audit was last tendered in [year], leading to [audit firm]'s appointment from [date]; the Committee expects the next tender to take place no later than [year], and has no current plan to retender earlier.' |
The rule
UK Corporate Governance Code 2024, Provision 26
Version relied on: UK Corporate Governance Code, FRC, January 2024; applies to financial years beginning in or after January 2025 (Provision 29 from January 2026)
The annual report should describe the work of the audit committee, including: ... the matters set out in the Audit Committees and the External Audit: Minimum Standard
Audit Committees and the External Audit: Minimum Standard, paragraph 24
Version relied on: FRC, Audit Committees and the External Audit: Minimum Standard, [date]
information on the length of tenure of the current audit firm, when a tender was last conducted and advance notice of retendering plans
Why it applies here: tenure is given, but the tender year and the retendering intention are not, so the compliance statement is not supported on these two items, although the omission is small.
Why it matters
Shareholders do not get the tender history and retendering intentions that the Minimum Standard places in the Audit Committee report, and the statements of compliance with the Code and the Standard are not supported on these items.
Exposure
Comply-or-explain reporting under the Code; at most a comment in a regulator's review of governance reporting.
Our workings
the Audit Committee report states that [audit firm] was appointed auditor with effect from [date], that 2025 was its second audit, and that the Committee complied with the CMA Order 2014 and the FRC's Minimum Standard. The corporate governance statement says [wording masked] of the Code in 2025. Code 2024 Provision 26 requires the annual report to describe the Audit Committee's work including the matters in the Minimum Standard, and paragraph 24 of the Standard lists the length of tenure of the audit firm, when a tender was last conducted and advance notice of retendering plans. A search of the whole report finds 'tender' only for the sustainability assurance provider and the remuneration adviser. The 2024 report said [audit firm] was appointed 'following a competitive tender process', but gave no year either.
Management’s best defence, and our reply
The Committee can say that tenure is plain from the statement that [audit firm] was appointed from [date], that the tender was described in earlier reports, and that the next mandatory tender and rotation dates follow from the audit regulations, so there is nothing new to announce. A reasonable preparer could therefore treat the Minimum Standard item as met in substance. The answer: the Standard asks for the tender date and advance notice of retendering plans in the annual report itself, and the 2025 report gives neither, so one sentence is needed to support the compliance statement; because the substance is not in doubt the point is put as a question.
The fix
- Add one sentence giving the year of the last audit tender and the Committee's expected timing for the next tender, or explain the departure.
Question for the company
In which year was the audit tender that led to [audit firm]'s appointment from [date] conducted, and what does the Committee expect for the timing of the next audit tender?
Evidence relied on
| # | What it shows | Type | Where |
|---|---|---|---|
| 1 | Tenure is given: [audit firm] auditor from [date] | Document | Annual Report 2025, page 144 |
| 2 | The Committee states compliance with the Minimum Standard | Document | Annual Report 2025, page 144 |
| 3 | The governance statement claims compliance with all Code provisions, including Provision 26 | Document | Annual Report 2025, page 100 |
| 4 | 2025 was [audit firm]'s second audit | Document | Annual Report 2025, page 142 |
Absence check
- Document
- Annual Report 2025
- Where it would appear
- Independence of external auditor
- What is missing
- the year in which the audit was last tendered and any advance notice of retendering plans
- Pages looked at
- p.141-146 (Audit Committee report), p.100 (governance statement)
- Result
- 'tender' hits p.145 (tender for the sustainability reporting assurance provider) and p.174 (tender for the remuneration adviser); neither concerns the statutory audit. 'tender' also hits p.88, [n] and 302, which concern procurement and public tenders in the markets the Group sells into, not the audit. 'retender', 're-tender', 'next tender' and 'audit firm rotation' have no hits; the only rotation text is about the audit partner rotating every five years
Prepared by Pramanex from the company’s published annual reports, without the company’s involvement, to show how an annual report review reads. The company is not named, and nothing on this page is a statement about any identifiable company. Observations are not an audit, review or other assurance engagement, and not legal advice. A regulator-style question is a question, not a conclusion.
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