BETTER FINANCE is very concerned that this major reform that would go a long way towards improving investor trust, is being watered down or, worse, abandoned.
In June 2020, the Wirecard
scandal unraveled, generating unprecedented retail investor detriment
worth about €20 billion. BETTER FINANCE reacted, labelling it an “outrageous case of corporate governance, external auditing and supervisory failures”[1] and calling for an urgent reform of EU Audit Rules.
The responsibility and liability of the external auditor is at stake.
More than two years ago the fraud was first brought to light by
journalists and whistle-blowers, instead of the auditors whose
responsibility it was to do so. Since then, no indemnification has been
received by, or even proposed to, the victims so far.
This is why the European Commission (EC) announced the roadmap for
regulatory reform of the EU Audit Rules and sent out a public
consultation about improved corporate reporting requirements in November
2021.[2]
In particular, it was considering moving to a joint or shared audit
for large corporations. But since then, the reform does not seem to have
progressed, and BETTER FINANCE is very concerned that this major reform
that would go a long way towards improving investor trust, is being
watered down or, worse, abandoned.
[1] See BETTER FINANCE Press Release available here: https://betterfinance.eu/wp-content/uploads/PR-Wirecard-An-outrageous-case-of-accumulated-failures-01072020.pdf.
[2] See BETTER FINANCE’s response here: https://betterfinance.eu/publication/better-finance-response-to-the-ec-public-consultation-on-strengthening-the-quality-of-corporate-reporting-and-its-enforcement/.
BETTER FINANCE
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