Update

Audit Policy

 Cannot read this email? Open in your browser.October 2019 
 

Audit Policy Update

October 2019

 
 
 
 

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Highlights

 
 
 
 
  • Key Audit Matters in European Banking Sector – Update 2019
  • European Parliament publishes a summary of professor Willekens’ study on the EU statutory Audit Reform
  • Accountancy Europe updates its publication on audit exemption thresholds following changes in France and Italy
  • UK FRC publishes their annual study – Key Facts and Trends in the Accountancy Profession
 
 
 
 
 

Feature story

 
 
 
 

Key Audit Matters (KAMs) in European Banking Sector – Update 2019

For the second year in a row, we performed a survey on the auditor’s reporting of KAMs in the European banking sector. The survey aims to examine the additional value that KAMs reporting has for the auditor’s report and to see if there are any emerging trends or significant changes from previous year. Our survey provides insights and conclusions on the auditor’s reporting of KAMs for more than 60 European banks, which own the vast majority of the assets in the European banking sector.

This year, we focus on the number and types of KAMs that are being reported. Even though it is still early days of reporting on KAMs, the key risks in the banking sector seem to be relatively consistent across Europe. Read more

 
 
 
 
 

EU Developments

 
 
 
 

European Parliament publishes a summary of professor Willekens’ study on the EU statutory Audit Reform

European Parliament’s Policy department has prepared, at the request of the Economic and Monetary Affairs Committee (ECON), ‘At a Glance’ document on professor Willekens’ study on the EU Statutory Audit Reform. The document summarises the key findings of the study. Read more

In April 2019, professor Willekens presented her findings to Accountancy Europe’s members. Read more

 
 
 
 
 

International Developments

 
 
 
 

Accountancy Europe’s response to the IESBA Exposure Draft: Proposed revisions to the Code to promote the role and mindset

The Revised Code of Ethics for Professional Accountants became applicable in June 2019. In our response, we state that further changes should be limited to the cases where the need is significant. We also note that IESBA should be cautious when adding new terms to the Code as they may not always improve its clarity. Read more

 
 
 
 
 

National Developments

 
 
 
 

Latest changes in audit exemption thresholds in France and Italy

Following the latest changes in the audit exemption thresholds in France and Italy, we updated our publication Audit exemption thresholds in Europe in October 2019. It provides an overview of the recent changes and currently applicable thresholds in European countries.

UK: Kingman’s letter to the BEIS Committee

Sir John Kingman criticises the government in regard to the Queen’s Speech from 14 October. The criticism refers to not including any reference to the legislation needed for reform of the audit regulator. His letter acknowledges that after the review was published in December 2018, significant progress has been made by the regulator and the government. However, he expresses his disappointment that the crucial final piece, i.e. legislation, was not included in the Queen’s Speech, which sets out the government’s programme for the year. Read more

UK: FRC publishes their annual study – Key Facts and Trends in the Accountancy Profession

The FRC study highlights, amongst others, the following developments in the accountancy profession:

  • The fees for non-audit work to audit clients for both big 4 and non-big 4 decreased in the UK
  • The total fee and the audit fee income on the other hand increased for big 4 but decreased for non-big 4
  • 100% of the FTSE 100 companies are now audited by big 4 companies
  • The number of accounting students increased in the UK and worldwide

Read more

Netherlands: Public consultation on the interim report of the Committee for the future of the accountancy sector (CTA)

On 1 October, the CTA published its preliminary report on the audit market in the Netherlands. The Committee has been looking into the audit market with the ultimate aim to improve audit quality.

Stakeholders then had 1 month to comment on this CTA interim report.

Report with final findings is expected to be published in December 2019. Read more (available in Dutch only)

 
 
 
 
 

Other news

 
 
The Guardian
 
Thomas Cook: MPs to question PwC on possible conflict of interest
 
ICAEW
 
Sir Donald Brydon’s speech: Future of audit
 
IAASB
 
Tom Seidenstein’s speech: The Future of international standard-setting
 
 
 

Events

 
 
02/10/19
 
Members’ Engagement Day: Storify summarising the event including the audit sessions
 

This curated content was brought to you by Júlia Bodnárová, Accountancy Europe Senior Advisor since 2017. You can send her tips by email and connect with her on LinkedIn.

 
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