The International Corporate Governance Network, representing about ₤7.5trn in assets, has urged EC for a Europe-wide review of audit services after its recommendation in June to cap auditors’ liability.

In a letter to Charlie McCreevy, internal market commissioner, and Neelie Kroes, competition commissioner, the ICGN urges the commission ‘to step up its efforts to ensure that the market for audit services in Europe, especially to large listed entities, becomes more competitive and more focused on audit quality'.

The letter called on the EC to emulate efforts in the US and the UK aimed at building ‘a better understanding of the competitive dynamics of the market for audit services in Europe and their relation with audit quality’.

‘Simultaneously, the commission could consider the possibility of new policy initiatives regarding audit firms’ transparency and public disclosures (beyond the requirements of Directive 2006/43/EC, which we consider progress but still insufficient), regarding ownership and liability,’ the letter said.

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