European Internal Markets and Services Commissioner Michel
Barnier will publish a policy paper in the autumn on the role of
auditorsand their
governance.

Barnier said it was time the role of
the auditors in the financial crisis was questioned.

“Governments have so far focussed their
attention on the urgent measures necessary to stabilise the
markets. Now we are entering a less reactive phase and I am
convinced that it is the right time to launch a real debate at
European level on the subject of audit,” he said.

“This conviction is reinforced by the
questions recently raised in the context of the audit of the
accounts of the US bank Lehman Brothers.”

Barnier said the objective of the
policy paper is to initiate a debate on the role and the governance
of auditors.

The paper will cover:

  • Concentration
    in the audit market and its implications on financial
    stability;
  • The emergence
    of small and medium sized practitioners;
  • The audit of
    SMEs; and,
  • International
    Standards on Auditing.

Barnier said
the EU should work towards strengthening the supervision of
audit firms at pan-European level.

“While the large audit firms have
centralised their management and decision making structures at
European level, their supervision continues to be done on a
national basis,” he said.