Weekly update of EU Regulatory news for FEE Members
European Parliament JURI adopts draft report on audit policy Green Paper: The Legal Affairs Committee, which is the lead Committee in the European Parliament dealing with the audit policy green paper of the Commission, voted unanimously on its report on 24 May 2011. The vote in plenary is scheduled on 22 June 2011.
The draft report, which is not formally part of the legislative process, recognises the importance and value of audit and the need for an expanded role in the future. It recognises the principle ‘an audit is an audit’ and calls for urgent “generalised and mandatory introduction of ISAs clarified through a regulation”. It supports strengthening audit committees’ role, in particular regarding auditors’ appointment and sees no justification for third-party appointment. The report also notes that partner rotation is preferable to firm rotation. Referring to the 2002 EU Recommendation, it calls on the Commission to identify the conditions that would make non-audit services incompatible. The report assumes that mandatory joint-audit could have positive effects and asks the Commission to make a cost/benefit analysis. Simplification of audit regulation and elimination of barriers to entry on the audit market is supported as well as a detailed investigation of the audit market by DG Competition. It also calls for a pan-European auditors’ liability regime. The draft should be available in the coming weeks. The opinion of the Economic and Monetary Affairs Committee (ECON) addressed to the Legal Affairs Committee concerning the EC Green Paper has already been published. View
FEE issues "Environmental, Social and Governance (ESG) indicators in annual reports - An introduction to current frameworks": The debate around the broader disclosure of ESG issues is important. FEE believes it can make a difference to the most necessary transition toward a sustainable economy. This paper aims at providing information on documents prepared by various bodies and most commonly referred to when considering the identification and use of ESG indicators (also Key Performance Indicators (KPIs) and reporting principles). View
Draft standard on review engagements: The FEE Executive approved the FEE comments to the IAASB on its exposure draft on Proposed International Standard on Review Engagements ISRE 2400 (Revised), Engagements to Review Historical Financial Statements. View
Sixth Public Report of the PIOB: In addition to the customary overview of its oversight activities in the year from April 2010 to March 2011, the report features a chapter discussing the PIOB’s views on what the public interest means in relation to the accountancy profession. View
Revenue recognition and lease projects: During the re-deliberations process, the IASB made some significant changes to its original proposals in relation to projects leading to the new IFRSs on revenue recognition and leases, in order to respond to comments received in public consultation. EFRAG will meet with the IASB in June 2011 to discuss the feedback received during the outreach in Europe. EFRAG published feedback statements reflecting input received in the outreach events in Copenhagen, London, Rome and Helsinki. View
Public consultation: Small Business, Big World - A new partnership to help SMEs seize global opportunities: DG Enterprise and Industry launched a consultation "Small Business, Big World - a new partnership to help SMEs seize global opportunities" to consult stakeholders on ideas for a more integrated and coherent approach to public support for EU enterprises to successfully do business outside the EU. Contributions should be submitted at the latest on 12 July 2011. Supporting documents are available at: View
FSB launches second peer review on compensation practices and invites feedback from stakeholders: The Financial Stability Board (FSB) has launched its second peer review on compensation practices. The review will assess the progress made by national authorities and significant financial institutions in implementing the FSB Principles for Sound Compensation Practices and their Implementation Standards, as well as the impact on compensation practices at financial institutions of national policy measures taken to implement the Principles and Standards. View
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