Financial Reporting Council Bangladesh


The Financial Reporting Council is a regulatory body established under the Financial Reporting Act, 2015. It is responsible for regulating the financial reporting of Public Interest Entities, as well as overseeing the activities of auditors and audit firms in Bangladesh. The FRC operates under the Finance Division of the Ministry of Finance, Government of the People's Republic of Bangladesh..

History

The Financial Reporting Council Bangladesh was established on 19 April 2016 as per Financial Reporting Act, 2015 as an independent regulatory agency. The agency is controlled by 12 member-governing body which has representatives from the government, Bangladesh Bank, Bangladesh Securities and Exchange Commission, Federation of Bangladesh Chambers of Commerce & Industries, professional accountants association and academia. It was created through the passage of Financial Reporting Act 2015 in the parliament of Bangladesh.

Members of the Council

Functional Divisions

It has Four Functional Divisions, namely:
  1. Standard Setting Division
  2. Financial Reporting Monitoring Division
  3. Audit Practice Review Division
  4. Enforcement Division

Evecutive Directors (Head of Functional Divisions)

Executive Director, Standard Setting Division: Executive Director, Financial Reporting Monitoring Division: Executive Director, Audit Practice Review Division: Executive Director, Enforcement Division:

Standards Issued

To date, FRC has adopted and promulgated International Financial Reporting Standards, International Standards on Auditing, International Valuation Standards and International Public Sector Accounting Standards, IESBA Code of Ethics, ISQMs and other relevant Standards.FRC also issued the for Statutory Public Authorities, also known as autonomous bodies in Bangladesh.
The promulgation of Actuarial Standards and Sustainability standards are also the prerogative of FRC.

Activities

FRC strictly monitors Bangladesh's Financial Reporting and Auditing of Public Interest Entities. Without getting enlisted with FRC, no auditor is permitted to perform statutory audits of Public Interest Entities in Bangladesh.

Definition of Public Interest Entities (PIEs)

In Bangladesh, the Financial Reporting Council designates certain entities as Public Interest Entities due to their significance to the public and national economy. These classifications ensure such entities adhere to elevated standards of financial reporting, accountability, and transparency. PIEs are grouped into two categories:
  • By Virtue
  • By Determinants.
By Virtue
These entities are classified as PIEs by legal mandate under relevant legislation:
  1. Banks, under the Banking Companies Act, 1991
  2. Listed Companies, under the Bangladesh Securities and Exchange Commission Act, 1993
  3. Financial Institutions, under the Finance Companies Act, 2023
  4. Microcredit Providers, under the Microcredit Regulatory Authority Act, 2006
  5. Insurers, under the Insurance Act, 2010
By Determinants
Entities in this category are considered PIEs only if they meet certain financial or operational criteria and are not already included in the "By Virtue" segment. These include:
  1. Companies, under the Companies Act, 1994
  2. State-Owned Enterprises
  3. Statutory Authorities / Autonomous Bodies
  4. Non-Governmental Organizations
  5. Other Organizations with similar business scope
These organizations are recognized as PIEs only if they fulfill one or more of the following conditions in the preceding reporting year:Revenue equal to or exceeding BDT 50 crore;
ORAny two of the following:External liabilities equal to or exceeding BDT 10 croreAssets equal to or exceeding BDT 30 croreWorkforce comprising 50 or more individuals
Note: City Corporations and Pouroshobhas, being statutory authorities under their respective laws, are also classified as PIEs subject to the above conditions.

Association and Memberships

The Financial Reporting Council Bangladesh actively engages with various international and regional standard-setting and development bodies to align its practices with global benchmarks. It maintains institutional collaboration with the IFRS Foundation, which oversees the International Accounting Standards Board —the body responsible for developing and issuing International Financial Reporting Standards. In the public sector domain, FRC liaises with the International Public Sector Accounting Standards Board to enhance transparency and accountability in government financial reporting. It is also a participating member of the Asian-Oceanian Standard-Setters Group, which promotes the adoption and convergence of accounting standards across Asia and Oceania. Furthermore, FRC contributes to global initiatives under the United Nations Conference on Trade and Development, especially in the area of sustainable enterprise and corporate reporting. In the not-for-profit sector, FRC supports the efforts of the International Financial Reporting for Non-Profit Organizations initiative, aimed at developing internationally applicable financial reporting guidance for non-profit entities. In the field of valuation, FRC aligns with best practices set by the International Valuation Standards Council, which develops and promotes global valuation standards.

MOUs and Contracts

In 2020 it signed agreements with International Valuation Standards Council, International Federation of Accountants, and IFRS Foundation.

History

The Financial Reporting Council Bangladesh was established on 19 April 2016 as per Financial Reporting Act, 2015 as an independent regulatory agency. The agency is controlled by 12 member-governing body which has representatives from the government, Bangladesh Bank, Bangladesh Securities and Exchange Commission, Federation of Bangladesh Chambers of Commerce & Industries, professional accountants association and academia. It was created through the passage of Financial Reporting Act 2015 in the parliament of Bangladesh.
In 2020 it signed agreements with International Valuation Standards Council, International Federation of Accountants, and IFRS Foundation.