Grant Thornton welcomes the progress made in the European Competitiveness Council on key elements of a draft law on statutory audit services for large public companies.
The Council has had an encouraging exchange of views in which there was strong support to address investor concerns about long auditor tenure at large companies by recommending a maximum period for which their auditor may serve. Grant Thornton supports EU Member States allowing a significant increase in the rotation period where the company uses more than one auditor.
Many on the Council also shared investor concern about the volume and nature of non-audit services provided by a company’s auditor by imposing a cap by reference to the audit fee.
We believe that the combined result of these proposals could also help to change audit market structure for the better, provided that companies and their shareholders work together to change auditor selection decisions.
Grant Thornton also supports proposals to improve engagement between auditors and supervisors; and auditors, audit committees, and shareholders.
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