Audit policy: Letter from Philippe de Buck to Commissioner Barnier

19 October 2011

In the letter, BusinessEurope raised concerns about various measures the EC is currently discussing for the audit market. In particular, the mandatory rotation of audit firms and mandatory joint audits may have unintended consequences for the European audit market.

BusinessEurope considers that most measures under consideration do not reflect the real issues. In its view, the EC has still to demonstrate the role of auditors in the development of the crisis. Concerns have been raised but these have not been substantiated by factual information showing a breakdown in controls or unsuitable regulatory framework. Such proof is necessary for proposing any corrective measures. Criticism on the functioning of auditors relates primarily to the shortcomings and the complexity of the IFRS reporting framework. Auditors cannot solve these problems and should not be required to do so. Therefore, BusinessEurope believes that most proposal that are currently under consideration will on balance not solve the perceived problems with the functioning of auditors. Proper measures must be accompanied by initiatives that allow the application of professional judgment, instead of the current practices of an IFRS compliance review.

Full letter

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