The Government and Financial Reporting Council (“FRC”) identified a number of constraints on its effectiveness. To address these constraints, the Government and FRC published for consultation in October 2011 a set of proposals designed to: (i) clearly align the scope of FRC’s activities with its mission to maximise the benefits of its activities to capital markets; (ii) simplify its organisational structure to make it more joined up and relevant to current and future challenges; (iii) ensure sufficient independence of the FRC from the accountancy professional bodies; and (iv) provide the FRC with a more proportionate range of sanctions and procedures for it to carry out its monitoring and enforcement activities. This document sets out the Government and FRC’s response to that consultation and future plans to reform the FRC.