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Brussels acts on audit quality

The European Commission has sent a formal recommendation to European Union member states aimed at improving the quality of statutory audits, by setting minimum standards for quality assurance systems, writes Alan Osborn.

Not all EU auditors are covered by an obligatory quality assurance system. The recommendation ‘will ensure all are covered by equivalent quality assurance systems with sufficient public oversight and published results,’ said the commission. Internal market commissioner Frits Bolkestein said the lack of other EU-wide mechanisms to enforce accounting standards put importance on good quality statutory audit within the EU.

The recommendation defines minimum requirements which will require nearly all member states to upgrade their quality assurance systems.

‘The requirements on public oversight with a majority of non-practitioners, publication of the results and the possibility of access to the review files by the authorities constitute an extension of the quality assurance systems for virtually all member states,’ Bolkestein said.

Unlike EU directives and regulations, a recommendation does not have the legal power to force compliance, but is an official statement of the Commission’s view.

Links

‘Unacceptable’ errors in EU accounts

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