Communication from the Commission on the statutory audit in the European Union: the way forward
Date: 1998-05-08
Institutions: European Commission
Subjects: accountant, auditing, financial legislation, freedom to provide services, organisation

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Official  Journal  of  the  European  Communities

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Communication  from  the  Commission  on  the  statutory  audit  in  the  European  Union:  the  way
forward

(98/C  143/03)

1.(cid:217)INTRODUCTION  AND  SUMMARY

to  have 

requirement 

should  enhance 

1.1.(cid:218)(cid:217)The 
the  annual  and
consolidated  accounts  of  certain  companies  audited  by  a
qualified  professional,  which  was 
introduced  for  the
Community  as  a  whole  by  the  Accounting  Directives,  is
designed  to  protect  the  public  interest.  The  assurance
offered  by  audited  accounts 
the
confidence  of  all  parties  that  have  dealings  with  the
companies  concerned.  Audited  financial  statements  of  a
company  established  in  one  Member  State  are  used  by
third  parties  in  other  Member  States,  such  as  investors,
increased  transparency
creditors  and  employees.  The 
resulting 
financial
the 
the  harmonisation  of 
information  published  by  companies,  together  with  the
increased  reliability  of  that  information  as  a  result  of  the
audit  by  an  independent  and  qualified  professional,  are
an  important  contribution  to  the  establishment  and  the
functioning  of  the  Single  Market.

from 

1.2.(cid:218)(cid:217)These  objectives  are  undermined  if  third  parties
cannot  assume  a  certain  level  of  reliability  and  a  certain
coverage  of  the  audit.  The  regulatory  framework  which
surrounds  the  statutory  audit  at  EU  level  is  however
incomplete.  There  is  no  common  view  at  EU  level  on  the
role,  the  position  and  the 
liability  of  the  statutory
auditor.  The  absence  of  such  a  common  view  has  a
negative 
impact  on  audit  quality  and  hence  on  the
confidence  that  is  placed  in  audited  accounts,  as  well  as
on  the  freedom  of  establishment  and  freedom  to  provide
services  in  the  audit  field.

lack  of  a  harmonised  view  at  EU 

1.3.(cid:218)(cid:217)The 
level
concerning  the  statutory  audit  could  become  a  serious
handicap  in  the  negotiations  that  are  taking  place  at
international  level  with  a  view  of  improving  the  access  of
European  companies  to  the  international  capital  market.
There 
the  accounts  and
consolidated  accounts  prepared  by  European  companies
will  not  be  accepted  in  international  capital  markets
unless  these  accounts  have  been  audited  by  an  inde(cid:220)
pendent  and  qualified  professional  in  accordance  with
auditing  standards  which  are  accepted  worldwide.

is  a  significant  risk 

that 

opment  of  these  standards  can  be  assured  and  a  high
level  of  respect  for  these  standards  throughout  the  EU  be
guaranteed.  Discussions  will  also  concern  the  subjects  of
auditor 
control,  professional
competence,  the  position  of  the  statutory  auditor  within
the  company  and  the  role  of  internal  audit.

independence,  quality 

the 

freedom  of  establishment  and 

1.5.(cid:218)(cid:217)With  the  possible  exception  of  a  sectoral  Directive
concerning 
the
freedom  to  provide  services  in  the  audit  field,  it  may  be
possible  to  carry  out  this  reform  without  proposing  new
legislation  or  legislative  change  at  EU  level.  However,
the  Commission  will  not  hesitate  to  propose  legislation  if
the  need  for  this  becomes  apparent  in  the  course  of  the
ongoing  discussions.

2.(cid:217)BACKGROUND

2.1.(cid:218)(cid:217)In  accordance  with  the  Fourth  Council  Directive
78/660/EEC  of  25  July  1978  on  the  annual  accounts  of
certain  types  of  companies,  all  companies  covered  by  the
Directive  must  have  their  annual  accounts  audited  by  a
qualified  professional.  The  statutory  auditor  must  also
see  to  it  that  the  annual  report  is  consistent  with  the
annual  accounts  for  the  same  financial  year.  Member
States  may  exempt  small  companies  as  defined  in  the
Directive  from  the  obligation  to  have  their  accounts
audited.

entities 

to  all 

requirement 

2.2.(cid:218)(cid:217)The  Seventh  Council  Directive  83/349/EEC  of
13  June  1983  on  consolidated  accounts  extended  the
audit 
that  draw  up
consolidated  accounts  on  the  basis  of  the  Directive.
the  Council  Directives  86/635/EEC  of
Similarly, 
the  annual  accounts  and
18  December  1986  on 
consolidated  accounts  of  banks  and  other  financial  insti(cid:220)
tutions  and  91/674/EEC  of  19  December  1991  on  the
annual  accounts  and  consolidated  accounts  of  insurance
undertakings  introduced  a  requirement  for  all  entities
their  annual
covered  by 
accounts  and  consolidated  accounts  audited  by  a
qualified  professional.

those  Directives 

to  have 

1.4.(cid:218)(cid:217)The  approach  proposed  in  the  present  communi(cid:220)
cation  consists  of 
institutionalising  a  discussion  of
auditing  matters  at  EU  level.  An  important  task  will  be
the  review  of  the  existing  international  standards  on
auditing  developed  by  the  International  Federation  of
Accountants  (IFAC).  The  EU  will  have 
to  decide
whether  it  wants  to  support  these  standards  and  if  so,
how  and  on  what  basis  European  influence  in  the  devel(cid:220)

2.3.(cid:218)(cid:217)Member  States  may  only  approve  as  auditors  the
persons  who  satisfy  the  conditions  of  the  Eighth  Council
Directive  84/253/EEC  of  10  April  1984  on  the  approval
of  persons  responsible  for  carrying  out  the  statutory
audits  of  accounting  documents.  The  conditions  of
approval  concern  professional  qualifications  on  the  one
hand  and  personal  integrity  and  independence  on  the
other.

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the 

issues, 

such  as 

the  statutory  auditor, 

2.4.(cid:218)(cid:217)While  the  Eighth  Directive  defines  the  minimum
it  does  not
qualifications  of 
inde(cid:220)
contain  any  specific  guidance  concerning 
pendence 
the
requirement.  Other 
appointment  and  dismissal  of  the  statutory  auditor,  the
audit  fee,  the  audit  report  and  the 
liability  of  the
statutory  auditor  are  dealt  with  in  the  Proposed  Fifth
Directive  concerning  the  structure  of  public 
limited
companies  and  the  powers  and  obligations  of  their
organs(cid:216)(˛),  which  remains  however  unadopted  by  the
Council.  Some  of  these  issues  are  regulated  at  national
level  or  are  the  subject  of  self(cid:220)regulation  through  the
accountancy  profession, 
inevitably
differences  in  the  way  they  are  dealt  with  and  there  is
often  no  legislative  backing.

there 

but 

are 

launched  by 

the  Commission,
2.5.(cid:218)(cid:217)Several  studies 
notably  on  "Competition  in  European  accounting’  (1992)
and  on  the  "Role,  the  position  and  the  liability  of  the
statutory  auditor’  (1996),  have  shown  that  there  is  not
yet  a  European  market 
in  audit  services  and  that
important  differences  remain  between  the  national  laws
and  regulations  of  Member  States  which  deal  with  the
statutory  audit.

this 

background, 

2.6.(cid:218)(cid:217)Against 
the  Commission
considered  it  useful  to  organise  a  wide(cid:220)ranging  reflection
on  the  scope  and  the  need  for  further  action  at  EU  level
on  the  statutory  audit.  As  a  first  step,  the  Commission
published  a  Green  Paper(cid:216)(ˇ)  on  the  "Role,  the  position
and  the  liability  of  the  statutory  auditor  within  the  EU’,
which  was 
the  awareness  of  all
to  raise 
interested  parties  concerning  the  issues  at  stake  and  to
elicit  their  comments.  The  Commission  received  over  100
written  contributions  in  response  to  the  Green  Paper.
Most  commentators  welcomed  the  Green  Paper  and
expressed  the  view  that  action  at  EU  level  was  necessary.

intended 

this  consultation  process, 

2.7.(cid:218)(cid:217)To  complete 
the
Commission  organised  on  5  and  6  December  1996  a
Conference  on  the  role,  the  position  and  the  liability  of
the  statutory  auditor  within  the  EU.  The  objective  of  this
Conference,  which  gathered  some  200  representatives  of
professional  institutes  and  public  authorities  responsible
for  the  audit  profession,  was  to  discuss  the  future  of
auditing  in  Europe  and  the  role  of  the  EU.  There  was
general  agreement  at  the  Conference  that  the  EU  should
have  a  common  framework  for  auditing  and  that  such  a
framework  should  preferably  take  as  its  base  the  inter(cid:220)
national  standards  on  auditing.  The  tentative  conclusions
that  the  Commission  drew  at  the  final  session  of  the
Conference  were  discussed  and  broadly  supported  at  a
meeting  of  the  Contact  Committee  for  the  Accounting
Directives  on  10  March  1997.

(˛)(cid:217)OJ  C  240,  9.9.1983,  p.  2.
(ˇ)(cid:217)OJ  C  321,  28.10.1996,  p.  1.

2.8.(cid:218)(cid:217)On  26  February  1997,  the  Economic  and  Social
Committee  adopted  an  opinion  on  the  Green  Paper.  The
Committee  welcomed  the  Green  Paper  as  provoking
much  needed  discussion  on  the  way  forward,  with  a  view
to  ensuring  high  and  compatible  standards  in  auditing
and  providing  the  basis  for  the  EU’s  approach  towards
international  standard  setting.  The  Committee  urged  the
Commission  to  establish  priorities  and  an  action  plan  in
the  EU.  The
terms  of  minimum  requirements 
Commission  should  encourage  as  far  as  possible  the
accounting  profession  itself  to  unify  its  procedures  across
the  EU  through  effective  self(cid:220)regulation,  but  a  wider
range  of 
interested  parties  such  as  shareholders  and
company  directors  should  be  involved  in  the  discussion,
which  should  be  carefully  monitored  by  the  Commission.

for 

in  giving  credibility 

2.9.(cid:218)(cid:217)On  15  January  1998,  the  European  Parliament
approved  a  resolution  broadly  supporting  the  Green
Paper.  The  Parliament  stressed  the  important  role  of  the
auditor 
to  companies’  financial
reports,  something  that  is  an  essential  underpinning  of
the  Single  Market.  The  Parliament  also  stressed  the
importance  of  removing  any  barriers  at  national  level
that  may  be  restricting  auditors’  freedom  of  estab(cid:220)
lishment  and  their  freedom  to  provide  cross(cid:220)border
services.

2.10.(cid:218)(cid:217)The  main  issues  raised  by  the  Parliament  were:

-(cid:217)auditor  independence  requirements.  The  Green  Paper
calls  for  the  establishment  of  a  common  core  of
essential  principles  on  independence,  which  would  be
formulated  by  the  profession  itself.  The  European
Parliament’s  resolution  calls  for  the  definition  of
non(cid:220)audit  services  in  the  context  of  the  need  for  the
introduction  of  Community  rules  on  independence,

-(cid:217)the  need  for  new 

legislation.  The  Green  Paper
envisages  achieving  the  required  changes  as  far  as
possible  without  new 
legislation.  The  European
Parliament  calls  on  the  Commission  to  consider
whether  or  not  it  will  be  necessary  to  introduce  new
legislation  to  achieve  greater  harmonisation.

3.(cid:217)PROPOSED  ACTION

preparing 

the
3.1.(cid:218)(cid:217)In 
Commission  has  paid  particular  attention  to  respecting
the  principles  of  subsidiarity  and  proportionality,  as
enshrined  in  the  Treaty.  New  legislation  or  amendment

proposed 

actions, 

its 

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level 

legislation  at  EU 

the  European  Parliament, 

of  existing 
is  not  necessarily
envisaged.  However,  in  response  in  particular  to  the
recommendation  of 
the
Commission  confirms  that  it  will  not  hesitate  to  propose
new  legislation  where  it  believes  it  is  necessary.  It  is  also
desirable  to  avoid  the  creation  of  an  additional  layer  of
standards  on  top  of  those  already  existing  or  in  prep(cid:220)
aration,  at  national  and  international  level.  A  flexible
is  needed  which  can  respond  rapidly  to
framework 
current  and  future  developments.  Priority  must  be  given
to  areas  where  current  national  legislation  and  practice  is
an  obstacle  to  the  operation  of  the  Single  Market.

Committee  on  auditing

auditing, 

3.4.(cid:218)(cid:217)Through 
the
the  Committee  on 
profession  will  be  continuously  challenged  to  live  up  to
its  commitment  to  deal  with  auditing  matters  on  the  basis
of  self(cid:220)regulation.  Ideally,  the  Committee  on  auditing
will  be  able  to  recommend  endorsement  of  the  results  of
the  profession’s  work.  The  profession  will  be  expected  to
provide  much  of  the  raw  material  which  will  be  the  basis
of  the  Committee’s  deliberations.  The  principal  tasks  of
the  Committee  on  auditing  will  include:

-(cid:217)a  review  of  existing 

international  standards  on
auditing  and  their  application  in  an  EU  context  with
the  objective  of  determining  whether  the  application
of  these  standards  meets  the  full  need  for  auditing
standards  in  the  EU  or  whether  there  are  gaps  to  be
filled,

line  with 

the  new  approach 

3.2.(cid:218)(cid:217)In 
successfully
followed  in  the  area  of  accounting  since  1995(cid:216)(˛),  the
Commission  intends  to  set  up  a  Committee  on  auditing,
which  will  have  special  responsibilities 
for  auditing
matters.  The  Committee  on  auditing  will  be  composed  of
government  experts  nominated  by  the  Member  States.
The  Commission  would  welcome 
the  presence  of
representatives  of  the  bodies  that  elaborate  auditing
standards  at  national  level.  Moreover,  it  is  important  that
the  accounting  profession,  which  has  the  primary  respon(cid:220)
sibility  for  the  technical  aspects  of  auditing  standards  and
which  shares  with  public  authorities  the  responsibility  for
for  auditing
ensuring 
(professional  qualifications  and  independence)  are  met,
the  Committee’s  work.  The
be  closely 
European  accounting  profession  should 
therefore  be
represented  in  the  Committee  on  auditing.

requirements 

the  basic 

involved 

that 

in 

for 

the  Committee  on  auditing 

the
3.3.(cid:218)(cid:217)The  European  Parliament  also  calls 
Commission  to  study  the  role  that  internal  audit  can  play
in  relation  to  external  audit,  and  the  Commission  will
welcome  the  participation  of  the  European  internal  audit
profession  in  the  Committee  on  auditing.  The  European
Parliament  and  the  Economic  and  Social  Committee  call
for 
to  have  a  wide
involvement  of  audit  report  users.  The  Commission
proposes  that  the  Accounting  Advisory  Forum  should  be
associated  with  the  work  of  the  Committee  on  auditing
to  ensure  that  a  wide  range  of  end  users  is  involved.  The
Accounting  Advisory  Forum  was  set  up  in  1991  as  an
advisory  body  comprising  representatives  of  accounting
standard(cid:220)setting  bodies  and  users  and  preparers  of
accounts.

(˛)(cid:217)Communication 

from 

harmonisation:  A  new 
harmonisation,  COM(95)  508,  November  1995.

the  Commission  on  accounting
international

strategy  vis(cid:220){(cid:220)vis 

-(cid:217)contributing 

to 

International
the  work  of 
Auditing  Practices  Committee  of  the  International
Federation  of  Accountants,  including  coordination  of
views  on  exposure  drafts,

the 

-(cid:217)an  examination  of 

the  audit  quality  monitoring
the  Member  States  and  of  possible

systems 
proposals  for  improvement,

in 

-(cid:217)an  examination  of  a  set  of  core  principles  on  inde(cid:220)
pendence  developed  by  the  European  accounting
profession.

3.5.(cid:218)(cid:217)On  all  matters  the  Committee  on  auditing  will
report  to  the  Contact  Committee  on  the  Accounting
Directives.  This  is  particularly  the  case  for  issues  of  a
more  political  nature,  such  as  the  definition  of  the
statutory  audit  and  the  contents  of  the  audit  report.

3.6.(cid:218)(cid:217)The  Commission  proposes  holding 
meeting  of  the  Committee  on  auditing  in  May  1998.

the 

first

Auditing  standards

3.7.(cid:218)(cid:217)The  review  of  existing  international  standards  on
auditing  (ISA)  in  an  EU  context  will  be  undertaken  as  a
matter  of  priority,  on  the  basis  of  papers  prepared  by  the
Commission  in  consultation  with  the  auditing  profession
at  the  European 
is  to  have  a  first
level.  The  aim 
substantive  discussion  at  the  second  meeting  of  the
Committee  on  auditing  in  the  latter  part  of  1998.

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3.8.(cid:218)(cid:217)One  issue  to  be  addressed  is  the  extent  to  which
current  ISAs  provide  adequate  guidance  to  European
auditors  to  help  them  with  the  issues  raised  by  the
significant  developments  in  accounting  standard  setting.
As  accounting  standard  setting  develops  it  may  be  that
auditing  standards  will  naturally  need  to  evolve  further.
In  particular,  guidance  may  be  required  on  how  auditors
satisfy  themselves  that  financial  statements  comply  with
relevant  laws,  where  the  statements  have  been  prepared
using  accounting  standards  different  from  those  normally
applicable  under  national  law.

Quality  control  for  compliance  with  standards  and  the
independence  principle

3.9.(cid:218)(cid:217)In  accordance  with  the  Eighth  Directive,  Member
States  must  ensure  that  auditors  carry  out  their  tasks
with  due  care  and  in  full  independence.  Although  it  is
necessary  that  the  supervision  of  the  audit  profession  is
carried  out  in  the  first  instance  by  the  profession  itself,
the  ultimate  responsibility  for  ensuring  respect  for  these
fundamental  public  interest  requirements,  enshrined  in
Community 
the  governments  of
Member  States.  Not  all  Member  States  have  set  up
systems  of  quality  control.  Some  Member  States  have
sytems  that  tend  to  make  supervision  more  a  matter  of
form  than  of  substance.

law,  remains  with 

3.10.(cid:218)(cid:217)In  order  to  ensure  equivalent  and  high  audit
quality,  it  is  important  first  to  do  further  research  in  this
area  and  to  examine  how  the  systems  of  quality  control
in  the  auditing  field  operate  in  practice.  The  European
accounting  profession  has  agreed  to  carry  out  this  exam(cid:220)
ination  as  a  matter  of  priority  and  to  report  their
findings  to  the  technical  subcommittee.  It  is  expected
that  at  least  a  first  report  will  be  ready  for  discussion  by
the  subcommittee  in  May  1998.  On  the  basis  of  the
report  of  the  Committee  on  auditing  to  the  Contact
Committee,  the  Commission  will  consider  whether  any
further  initiative  at  EU  level  is  required  in  this  area.

Corporate  governance

3.12.(cid:218)(cid:217)The  role  of  the  auditor  must  be  seen  in  the
wider  context  of  corporate  governance.  There  is  general
agreement  that  there 
is  scope  for  strengthening  the
position  of  the  statutory  auditor  within  the  corporate
structure.  Suggestions 
the  creation  of  audit
include 
committees  and  the  institutionalisation  of  the  internal
audit  function.  There 
is  also  general  agreement  that
corporate  entities  themselves  should  place  more  emphasis
on  their  own  systems  of  control  for  managing  and
reporting  risk.  In  this  context  it  is  particularly  relevant
inherent  to  related
that  companies  manage  the  risks 
party  transactions.

3.13.(cid:218)(cid:217)At  the  same  time,  it  is  necessary  to  keep  in  mind
the  wide  differences  that  exist  in  corporate  structures
across  the  Member  States  and  the  difficulties  which
previous  efforts  to  arrive  at  a  common  view  in  this  area
have  encountered.  This  aspect  of  the  statutory  audit  will
be  pursued  in  the  light  of  the  follow(cid:220)up  to  the  consul(cid:220)
tation  that  the  Commission’s  services  launched  in  1997
on  company  law.

Professional  liability

3.14.(cid:218)(cid:217)A  large  majority  of  the  respondents  to  the  Green
Paper  expressed  the  view  that  harmonisation  of  the  rules
on  the  professional  liability  of  the  statutory  auditor  is
impossible  and  unnecessary.  The  Commission  however
received  strong  representations 
the  accounting
profession  to  initiate  action  on  this  matter.  It  was  argued
that,  from  a  Single  Market  point  of  view,  it  is  important
to  ensure  that  different  national  rules  and  practices  on
liability  do  not  create  barriers  between  Member  States
and  that  unreasonable  claims  do  not  endanger  the  audit
function.

from 

3.15.(cid:218)(cid:217)The  Commission  will  examine  in  more  detail  the
various  concepts  that  play  a  role  in  the  determination  of
the  civil  liability  of  the  statutory  auditor  in  Member
States.  Once  the  results  of  this  examination  are  known,
the  Commission  will  be  in  a  better  position  to  judge
whether  an  initiative  in  this  area  is  necessary.

3.11.(cid:218)(cid:217)The  profession  has  undertaken  to  review 
its
earlier  work  on  independence  with  a  view  to  establishing
a  set  of  core  principles  for  the  guidance  of  auditors  in
the  EU.  The  results  of  this  work  will  also  be  examined
by  the  Committee  on  auditing  with  the  objective  of
enhancing  the  reliability  of  accounts  through  a  stronger
assurance  of  independence  on  the  part  of  the  auditor.
the  European
recommendation  of 
Following 
Parliament,  the  Commission  will  ensure  that  particular
attention  is  paid  to  determining  which  non(cid:220)audit  services
do  or  do  not  risk  impairing  auditor  independence.

the 

Professional  qualifications

to  ensure 

that
3.16.(cid:218)(cid:217)The  Eighth  Directive  aims 
auditors  are  highly  qualified  professionals.  The  further
development  of  the  competence  requirements  listed  in
the  Directive  could  help  to  ensure  higher  and  more
closely  equivalent  standards.  To  this  end  it  is  proposed  to
organise  a  closer  coordination  of  the  curricula  for  the
training  of  auditors.  This  should  be  primarily  a  task  for
the  accounting  profession  and  for  those  who  are  directly
involved  in  the  educational  process.  The  Commission

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will  provide  a  platform  for  discussion  of  this 
issue,
making  appropriate  use  of  existing  programmes,  notably
Socrates  and  Leonardo  da  Vinci.

Freedom  to  provide  auditing  services

recognition(cid:216)(˛) 

implementation 

in  practice  of 
in 

3.17.(cid:218)(cid:217)The  European  Parliament  strongly  supports  the
the  general
effective 
Directive  on  mutual 
to
relation 
auditing.  The  Commission  believes  that  the  promotion  of
the  freedom  of  establishment  and  the  freedom  to  provide
services  is  particularly  important  for  smaller  firms  of
auditors  and  individual  practitioners.  The  Commission
will  discuss  with  Member  States  and 
the  Contact
Committee  on  the  Accounting  Directives  the  practical
difficulties  that  have  arisen  in  the  context  of  freedom  of
establishment  and  freedom  to  provide  services  in  the
auditing  field.  The  European  accounting  profession  will
be  closely  associated  with  this  exercise,  in  particular  to
report  on  the  practical  difficulties  they  have  encountered
with  the  implementation  of  existing  mutual  recognition
legislation.  The  group  of  coordinators  for  the  general
system  of  mutual  recognition  will  also  be  consulted.

the  freedom 

sectoral  Directive 

3.18.(cid:218)(cid:217)The  Commission  regards  the  effective  implemen(cid:220)
tation  of  the  general  Directive  on  mutual  recognition  as
to  provide
an  essential  component  of 
auditing  services.  The  Commission  will  also  further
examine  with  the  accounting  profession  the  feasibility  of
a 
for  auditors.  This  would  be
envisaged  if  it  becomes  clear  that  it  would  constitute  an
improvement  over  the  general  Directive  for  both  audit
firms  and  individual  practitioners,  and  that  it  would  have
the  support  of  the  profession  and  the  Member  States.  As
regards 
the
Commission  has  suggested  to  the  European  accounting
profession  to  agree  on  a  rule  which  would  ease  or  even
exempt  from  the  aptitude  test  that  Member  States

individual  practioners, 

improvement 

for 

(˛)(cid:217)OJ  L  19,  24.1.1989,  p.  16.

require  under  the  Directive,  creating  a  general  system  for
the  recognition  of  diplomas  in  order  to  obtain  the  host
professional  title.  These  facilities  would  be  granted  by
taking  into  consideration  the  experience  that  would  be
gained  by  the  migrant  in  working  under  his  home  title
with  an  auditor  (accountant)  having  the  host  title.

Small  and  medium(cid:220)sized  companies

system  whereby 

3.19.(cid:218)(cid:217)The  Commission  believes,  and  responses  to  the
Green  Paper  confirm,  that  there  is  no  need  to  change  the
present 
small  companies  may  be
exempted  from  the  obligation  to  have  their  accounts
audited  by  a  qualified  professional.  The  European
Parliament  supported  this  view.  However, 
it  would
appear  useful  to  examine  to  what  extent  the  accounting
profession  can  play  a  more  active  role  in  assisting  SMEs.
The  Commission  will  ask  the  European  accounting
profession  to  come  forward  with  proposals  in  this  area.

4.(cid:217)CONCLUSION

4.1.(cid:218)(cid:217)The  wide  consultation  which  has  taken  place  on
the  matter  of  the  statutory  audit  has  shown  general
agreement  that  the  audit  function  is  important,  that  the
EU  needs  a  framework  of  reference  in  the  auditing  field
and  that  such  a  framework  should  be  based  as  far  as
possible  on  existing  international  standards.

4.2.(cid:218)(cid:217)The  overall  goals  of  the  approach  which  the
Commission  proposes  are  to  contribute  to  a  general
raising  of  the  quality  of  auditing  in  the  EU,  which  will
ultimately  benefit  all  parties  concerned  with  the  life  of
companies  and  to  improve  the  situation  as  regards  the
freedom  to  provide  auditing  services.

4.3.(cid:218)(cid:217)It  is  clear  that  this  approach  will  require  the  active
support  of  the  Member  States  and  of  the  European
accounting  profession  if  it  is  to  be  effective.  The  consul(cid:220)
tation  exercise  that  has  recently  been  concluded  provides
a  strong  assurance  that  this  support  will  be  forthcoming.

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ANNEX

LIST  OF  RESPONSES  TO  THE  GREEN  PAPER

In  addition  to  the  official  comments  of  the  Member  States,  the  following  organisations/institutions/
companies/private  individuals  have  provided  comments  on  the  Green  Paper.

European/international  organisations

Association  des  chambres  de  commerce  et  d’industrie

Centre  for  European  Policy  Studies

Council  of  the  Bars  and  Law  Societies  of  the  European  Community

EU  Committee  of  the  American  Chamber  of  Commerce  in  Belgium

European  Confederation  of  Institutes  of  Internal  Auditing

European  Contact  Group

European  Federation  of  Accountants  and  Auditors  for  SMEs

European  Federation  of  Financial  Executives  Institutes

European  Savings  Banks  Group

F~d~ration  bancaire  de  l’Union  europ~enne

F~d~ration  des  experts(cid:220)comptables  europ~ens

International  Auditing  Practices  Committee  of  the  International  Federation  of  Accountants

Moores  Rowland  International  Europe

Union  of  European  Accountancy  Students

Union  of  Industrial  and  Employers’  Confederations  of  Europe

Commentators  from  Member  States

Austria

Bundeskammer  f(cid:190)r  Arbeiter  und  Angestellte

Prof.  Dkfm.  Dr.  Helmut  Samer

Wirtschaftskammer  ˆsterreich

Belgium

Institut  des  experts(cid:220)comptables/Instituut  der  Accountants

Institut  des  r~viseurs  d’entreprises/Instituut  der  Bedrijfsrevisoren

Denmark

Anne  Loft  og  Miles  Gietzmann  (Handelsh(cid:192)jskolen  i  K(cid:192)benhavn)

Prof.  H(cid:192)jsl(cid:192)v  (Handelsh(cid:192)jskole  Syd)

Ph.(cid:216)D.  Bent  Warming(cid:220)Rasmussen

Finland

HTM  -  Tilintarkastajat  ry  (Association  of  Approved  Accountants)

Sis…iset  tarkastajat  ry  (Institute  of  Internal  Auditors)

France

Compagnie  nationale  des  commissaires  aux  comptes

Germany

Bundesverband  der  vereidigten  Buchpr(cid:190)fer  eV

Bundesverband  deutscher  Banken  eV

Deutscher  Genossenschafts(cid:220)  und  Raiffeisenverband  eV

Deutscher  Gewerkschaftsbund

Deutscher  Industrie(cid:220)  und  Handelstag

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Deutscher  Sparkassen(cid:220)  und  Giroverband

Institut  der  Wirtschaftspr(cid:190)fer

Steuerberaterkammer  Rheinland(cid:220)Pfalz

Wengert  AG

Wirtschaftspr(cid:190)ferkammer

Greece

Association  of  Certified  Accountants  and  Auditors  of  Greece

Hellenic  Auditing  Company  AE

Italy

Consiglio  nazionale  dei  dottori  commercialisti

Consiglio  nazionale  dei  ragioneri  e  periti  commerciali

Instituto  nazionale  revisori  contabili

Associazione  bancaria  italiana

Spain

Comisi(cid:246)n  nacional  del  mercado  de  Valores

Ilustre  Colegio  de  Abogados  de  Barcelona

Prof.  Fern‘ndez  Rodr(cid:242)guez  (Universidad  Nacional  de  Educaci(cid:246)n  a  Distancia)

Sweden

Svenska  Revisorsamfundet  (Swedish  Association  of  Approved  Auditors)

The  Netherlands

Drs.  J.(cid:216)H.(cid:216)J  Achten  RA

Nederlandse  Orde  van  Accountants(cid:220)Administratieconsulenten

A.(cid:216)P.  Schipper,  Registeraccountant

United  Kingdom

Auditing  Practices  Board

Chartered  Association  of  Certified  Accountants

Imperial  Chemical  Industries  plc

Institute  of  Chartered  Accountants  of  England  and  Wales  and  Institute  of  Chartered  Accountants  of
Scotland

Law  Society  of  England  and  Wales  and  Law  Society  of  Scotland

Christopher  Humphrey  and  Josephine  Maltby  (Sheffield  University)

Prof.  David  Hatherly  (University  of  Edinburgh)

Prof.  Ashley  Burrowes  (University  of  Glamorgan)

Vivien  Beattie  (University  of  Stirling),  Richard  Brandt  and  Stella  Fearnley  (University  of  Portsmouth)

Other  countries

Hungary

Chamber  of  Hungarian  Auditors

Norway

Norges  Registerte  Revisores  Forening

Switzerland

Bundesamt  f(cid:190)r  Justiz