The tabled directive insists auditors or audit firms are ‘independent from the audited entity and not in any way involved in management decisions’.
Furthermore they should not conduct audits if any relationship or additional services ‘might compromise (their) independence’.
The comprehensive and detailed directive was motivated by the Parmalat and Ahold scandals, and includes rules on auditing EU multinational firms.
They insist the auditor of a group’s consolidated accounts – based in its home country – take full responsibility, reviewing other auditors’ work.
A European audit regulatory committee would be created to adapt these regulations. EU internal market commissioner Frits Bolkestein said: ‘Auditors are our major line of defence against crooks who want to cook the books. Parmalat was a reminder of what happens when that defence fails.’
Mazars has announced the appointment of Michael Tripp as the new head of financial services
A new leader, Darra Singh has been appointed to lead EY’s UK government and public sector practice
MHA MacIntyre Hudson has partnered with cloud accounting software provider Xero ahead of the government’s requirement for digital records
Revenue and profitability growth in on the rise for CPA firms, found a survey from the American Institute of CPA’s and its subsidiary CPA.com