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ACCA supports the Commission's project to review all aspects of existing law and regulatory practice with the aim of learning lessons from that experience.
ACCA accepts that maintaining and enhancing the value of audit may mean making significant changes to how audits are currently conducted and regulated. ACCA has promoted the idea that the scope of audit needs to be expanded in order to take on more responsibilities which are likely to make a real difference to shareholders and regulators, such as reporting on how companies manage their strategic risks.
ACCA's head of technical, John Davies, explained: "We share the Commission's concerns about concentration in the listed company audit market and believe that changes should be made to the audit environment to encourage greater involvement on the part of smaller firms in listed company audit work. We also fully endorse the Commission's goal of improving audit quality and accept that integral to that goal must be to address issues relating to independence, objectivity and professional scepticism."
"In pursuing these ambitions however, we believe it is important to ensure that we do not resort to inflexible and bureaucratic measures which risk creating practical problems within the corporate sector and which could even prove counter-productive in terms of their effects on audit quality. Crucially, whatever arrangements are eventually adopted to replace the current Directive should, in our view, focus on outcomes as much as procedures", he added.
"ACCA looks forward to the publication of the European Commission's plans in November, and to engaging in a constructive dialogue on them, both with the EU executive and the co-legislators. With this in mind, ACCA is organising a round table meeting on the issue in Brussels in early December", John Davies concluded.