Raad akkoord met EU-richtlijn voor wettelijke accountantscontrole van jaarrekeningen (en)
The European Commission has welcomed a political agreement at first reading by the Council of Economic and Finance Ministers on the 8th Company Law Directive on statutory audit of annual accounts and consolidated accounts, which amends Council Directives 78/660/EEC and 83/349/EEC. Its objectives are to restore credibility of financial reporting and to enhance the EU's protection against the type of scandals that occurred in the past at companies such as Parmalat and Ahold.
The Commission proposed the Directive on 16 March 2004 (see IP/04/340, MEMO/04/60) and it was approved by the European Parliament on 28 September 2005 in a form to which the Council has now agreed, without the need for a second reading by either the Parliament or the Council.
Internal Market and Services Commissioner Charlie McCreevy said: "This is a crucial Directive, which will bring EU financial reporting into the 21st century by introducing a much more rigorous and ethical audit process for company accounts. Importantly, it will also require the application of international auditing standards and establish criteria for public supervision. All this will help to restore faith in the profession and in its independence, which was greatly undermined by recent high-profile scandals. I am very happy with the agreement reached by the Council today".
The new 8th Company Law Directive on statutory audit aims at reinforcing and harmonising the statutory audit function throughout the EU. It sets out principles for public supervision in all Member States. It also introduces a requirement for external quality assurance and clarifies the duties of statutory auditors.
Moreover, sound and harmonised principles of independence applicable to all statutory auditors through the EU have been defined.
The Directive further improves the independence of auditors by requiring listed companies to set up an audit committee (or a similar body) with clear functions to perform. It also foresees the use of international standards on auditing for all statutory audits conducted in the EU. Adoption of these standards will be subject to strict conditions such as their quality and whether they are conducive to the European public good.
The Directive provides a basis for effective and balanced co-operation between regulators in the EU and with regulators in third countries, such as the US Public Company Accounting Oversight Board (PCAOB). It also includes the creation of an Audit Regulatory Committee to complement the revised legislation and allow the speedy adoption of necessary implementing measures.
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