Council adopts new EU rules on audit of company accounts

25 April 2006

The Council adopted a directive updating, and introducing additional EU rules on the audit of company accounts, aimed at reinforcing the reliability of company financial statements by establishing minimum requirements for statutory audit of annual accounts and consolidated accounts. The Council accepted all of the European Parliament amendments in first reading.

Auditors and/or audit firms from third countries that issue audit reports in relation to securities traded in the EU must be registered in the EU and be subject to member state systems of oversight, quality assurance and investigations and sanctions.

The directive allows for exemption from registration only if audit firms from third countries are subject to equivalent systems of registration and oversight.

Member states are required to adopt provisions to comply with the new directive within two years of its entry into force. The directive comes into force twenty days after its publication in the Official Journal of the EU.

Press release

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