GFS LinkedIn
GFS Facebook
GFS Twitter
GFS RSS feed

EU audit reform proposals delayed

Friday 18 November 2011 - by Karina Whalley

Draft legislation expected to shake up the European audit industry is to be delayed due to ongoing eurozone crisis talks taking precendence, according to the European Commission.

Michel Barnier, EU internal market commissioner, was set to announce controversial changes to audit regulation on 23 November, including a clampdown on the dominance of the "big four" accountancy firms.

But due to an agenda change that has pushed forward a review of economic governance in the eurozone's less competitive member states, the EC has confirmed to Global Financial Strategy that proposals will now most likely be published on 30 November.

The directive on audit reform has been highly anticipated in the accounting industry, especially among the likes of Ernst & Young, KPMG, PricewaterhouseCoopers and Deloitte, which are expected to bear the full force of Barnier's reform drive.

Among its proposals, the EC is calling for companies to change auditors every nine years, as well as to alter tendering procedures to boost competition and force the separation of audit and non-audit services.


As reported by Global Financial Strategy, a survey of audit committee chairs of 22 FTSE 100 companies show widespread hostility to some of the rules, including mandatory rotation of auditors and the prohibition of audit firms performing non-audit services. Chairs say they fear they could have adverse effects on audit quality.


WHAT DO YOU THINK?
 
Name:
   
Email:
   
Comment:
   
Post as Anonymous
  Display name
   
Please, enter security code
   
 

No comments yet.

STRAW POLL

Will markets in 2012 have a tougher time than 2011?

Yes

No

Don't know

View results

FIND A REGION world regions