EBA欧洲银行-Appendix-II-CEBS-2010324-CEBS-response-to-EU-COM-Green-Paper-on-Audit-Policy_8页_178kb

CEBS Comments on the European Commission's Green Paper on Audit Policy Summary

Core Content

The Committee of European Banking Supervisors (CEBS) has provided detailed comments on the European Commission's Green Paper on Audit Policy, emphasizing the need for a clear, coherent, and effective audit framework in the context of the financial crisis.

CEBS, along with CESR and CEIOPS, collaborated in preparing these comments, highlighting their shared concerns and positions. The comments focus on the role of auditors, audit standards, governance and independence, supervision, market concentration, and international cooperation.

Main Views

1. Role of the Auditor

• CEBS believes that statutory audit should remain focused on the truth and fairness of financial statements rather than on financial health.
• They question the ability of auditors to provide high assurance on forward-looking information, due to its inherent uncertainty and limited objectivity.
• CEBS supports improving communication on the going concern assumption and the audit evidence supporting it.
• They see value in enhancing audit committee reporting to shareholders, but caution against overly generic audit report language.
• Qualified audit opinions should not be removed, as they reflect concerns about financial statements.
• CEBS suggests that professional scepticism should be improved by enhancing the application and enforcement of current standards, not by introducing new rules.

2. International Standards on Auditing (ISAs)

• CEBS supports the adoption of ISAs at the EU level and believes they are globally accepted and well-converged.
• They argue that amending ISAs would undermine the coherence and consistency of the standards.
• CEBS is open to add-ons if they stem from national legal requirements, but carve-outs should be avoided unless necessary.
• They expect the IFAC Code of Ethics to apply across the EU, particularly regarding audit partner remuneration and fee limits.

3. Governance and Independence of Audit Firms

• CEBS is cautious about third-party appointment mechanisms, as they may not necessarily improve audit quality or independence.
• They support audit committees in the appointment process and recommend greater transparency from oversight bodies and audit firms.
• CEBS believes that banking regulators should have a role in auditor appointments for credit institutions, given their reliance on audited financial information.
• They support a thorough debate on mandatory audit firm rotation and audit partner rotation, but caution against unintended consequences such as disruption and reduced audit quality.

4. Supervision

• CEBS recommends that the European Group for Auditing Oversight Bodies (EGAOB) be given a stronger mandate to promote supervisory convergence and provide technical advice.
• They do not support transferring auditor oversight to ESAs, as it requires specialized knowledge not aligned with the ESAs' current focus.
• CEBS advocates for enhanced interaction between auditors and supervisors, including the possibility of introducing a "right" for auditors to report to supervisory authorities.

5. Concentration and Market Structure

• CEBS acknowledges the risks of audit market concentration, but notes that the risks are not equivalent to those in the banking sector.
• They support mandatory rotation and greater transparency, but do not comment on market structure due to their lack of remit.
• CEBS warns that reducing audit quality could have negative impacts on the availability of credit for SMEs.
• They emphasize the need for international solutions to address the global nature of audit firms and their operations.

6. Creation of a European Market

• CEBS believes that a European audit market requires harmonized standards and independence rules.
• They support the adoption of ISAs and a common code of ethics as steps towards convergence.
• However, they note that national legal requirements and differences in legal systems may hinder full harmonization in the short term.
• CEBS questions whether a larger EU market would benefit SMEs, as most benefits are expected to go to larger firms.

Key Information

• Statutory Audit Directive: Recently implemented, and its application across Member States should be analyzed for areas of improvement.
• Impact Assessment: CEBS emphasizes the need for robust impact assessments before implementing any new audit policies.
• Audit Quality: Improvements should focus on enhancing current standards, not on introducing new rules.
• International Cooperation: CEBS supports global solutions and cross-border cooperation, especially given the international nature of audit firms and large organizations.

Conclusion

CEBS calls for a clear set of objectives, robust impact assessments, and enhanced supervision to improve audit quality and ensure public interest is served. They advocate for harmonized international standards, effective audit committee reporting, and international collaboration to address the complexities of the audit market.