Ireland moves closer to audit directive implementation

The primary purpose of the directive is to
establish minimum requirements for the regulation of statutory
auditors throughout the EU.

The directive aims to increase the quality of
audits in Europe following past corporate scandals. Specifically,
it requires that each member state establishes systems of external
quality assurance and public oversight of the audit profession.

It also provides for measures to improve
co-operation between regulatory authorities in the EU and sets out
a number of ethical principles to ensure the independence and
objectivity of statutory auditors and clarifies their duties. The
transposition deadline was 29 June last year.

The Institute of Chartered Accountants in
Ireland (ICAI) has welcomed the publication by the Department of
Enterprise, Trade and Employment of the new draft regulations.

ICAI director of technical policy Aidan Lambe
pointed out that Ireland has had many of the provisions outlined by
the directive in place as the local Companies (Auditing and
Accounting) Act 2003 established an organisation to oversee the
regulation of the auditing profession.

“The basic architecture envisaged by the
directive is already in place,” Lambe said. “However, the measures
contained in the [statutory audit directive] will not just impact
the auditing profession; it also contains new proposals as regards
the establishment and functions of audit committees by public
interest entities and measures aimed at safeguarding auditor
independence.”

The EC is also referring Austria, Italy and
Spain to the European Court of Justice over non-implementation of
the statutory audit directive.

Belgium, Ireland, Greece, Luxembourg, Poland
and Portugal have also been sent formal requests by the EC
regarding their failure to fully implement into national law the
latest directive in the field of accounting.

The transposition deadline was 5 September
2008.