If you are a listed company anywhere in Europe, then you could be affected by strict new rules for auditors, reports leading company secretarial services provider London Registrars (http://www.london-registrars.co.uk/).
A collective of more than a dozen institutional investors and trade bodies are calling for tougher auditing rules in a paper which insists that the European Commission (EC) and politicians across Europe take action to ensure that a banking crisis like that seen in 2008 cannot happen again. Last year, the EC ruled that listed companies have to change their auditor at least every six years, however a report by British MEP Sajjad Karim which recommends that this ruling be relaxed is currently under discussion.
Further rulings on auditing issues proposed by the EC include a ban on companies carrying out non-audit work for their audit clients. According to London City news portal City A.M., this would mean banning an area of business which creates as much as 15% of revenue for Pricewaterhouse Coopers, therefore company compliance with these tough new auditing rules could well be controversial. The group of top European investors are urging Brussels to limit non-audit work to a maximum of 50% of audit fees and insist there is greater transparency on the part of auditors. They believe that the failure of auditors to give warnings about the bank collapses seen in the economic crisis was down to a lack of independence and scepticism in the audit industry.
If you would like advice on whether your listed company will be directly or indirectly affected by these new auditing rules, speak to one of the experts at London Registrars, details at http://www.london-registrars.co.uk/.