Press Release: Audit of company accounts: Commission proposes Directive to combat fraud and malpractice

The European Commission has proposed a new Directive on statutory audit in the EU. The objectives are to ensure that investors and other interested parties can rely fully on the accuracy of audited accounts and to enhance the EU's protection against the type of scandals that recently occurred in companies such as Parmalat and Ahold. The proposed Directive would clarify the duties of statutory auditors and set out certain ethical principles to ensure their objectivity and independence, for example where audit firms are also providing their clients with other services. It would introduce a requirement for external quality assurance, ensure robust public oversight over the audit profession and improve co-operation between regulatory authorities in the EU. It would allow for swift European regulatory responses to new developments by creating an audit regulatory committee of Member State representatives, so that detailed measures implementing the Directive could be rapidly taken or modified. The proposal also foresees the use of international standards on auditing for all statutory audits conducted in the EU and provides a basis for balanced and effective international regulatory co-operation with third country regulators such as the US Public Company Accounting Oversight Board (PCAOB). The proposal will now be sent to the EU's Council of Ministers and the European Parliament for adoption under the so-called co-decision procedure.

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http://ec.europa.eu/comm/internal_market/auditing/index_en.htm http://ec.europa.eu/comm/internal_market/auditing/index_en.htm

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