FTSE 100 finance directors have largely rejected mandatory audit rotation and joint audit proposals developed by Brussels, a new survey shows.
Representative body the Hundred Group repeated a survey by recruitment specialist Robert Half, after it argued the original results did not represent the views of FTSE-leader finance chiefs.
The Hundred Group claimed none of its members responded to the Robert Half survey, which found 56% of CFOs and finance directors supported four-yearly rotation of auditors.
Robert Half has responded, saying as the survey was conducted anonymously by a third party, finance executives would not have known if they were replying to it.
The Hundred Group’s results showed no support for mandatory audit rotation or joint audit, and 14% in favour of mandatory audit tendering.
The two surveys were conducted after European Commissioner Michel Barnier called for radical audit reform, including pure audit firms, mandatory rotation and mandatory joint audits for the largest listed companies.
Barnier has since revised his plans. The joint audit proposal has been dropped, although an incentive to appoint two auditors remains, and the mandatory auditor rotation period has been reduced from nine years to six.
Hundred Group chairman Andy Halford (pictured) warned the final proposals “will still have very significant and profound implications for the way audits are conducted,” claiming: “The case for reform is overstated.”
He warned the package will reduce quality, increase costs and “diminish the value of the audit opinion to investors, without any tangible benefits”.
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