Amendment calling for separation of audit and consulting passes European Parliament’s ECON vote, second amendment proposed
On 18 February, the ECON Committee approved an amendment to EU competition report, tabled by MEP Eero Heinäluoma (S&D/Finland) and calling on the European Commission to consider UK CMA recommendations on joint audits and separation of audit and non-audit services. For further background information, please see the previous audit update.
The competition report, now including Mr. Heinäluoma’s paragraph, is to be voted in Plenary in the upcoming weeks. This final vote was initially supposed to take place on the week of 9 March, but has been postponed due to the corona outbreak.
Ahead of the Plenary vote, the MEP Stéphanie Yon-Courtin (RE/France) tabled a further amendment (nr. 6) on behalf of the whole Renew Europe Group, to amend the paragraph introduced by MEP Heinäluoma. Ms. Yon-Courtin’s amendment removes references to UK CMA and joint audits, but more explicitly calls on the Commission to consider the separation of audit from consulting services.
Two MEPs ask the European Commission to reform audit Regulation in AML context
MEPs continue to express concerns about the Luanda Leaks. In a most recent development, on 21 February the MEPs Eero Heinäluoma (S&D/Finland) and Jonás Fernández (S&D/Spain) sent a letter to Commission’s Executive Vice-President Dombrovskis.
In their letter, the MEPs argue that Luanda Leaks have shown inadequacies in the implementation and enforcement of the 5th AML Directive. They also express concern about the low number of suspicious activity reports submitted by ‘accountants’ in 2015.
The MEPs also refer to analysis from the NGO Transparency International which argues that “accountants, wittingly or unwittingly, often facilitate money laundering”.
They recognise that auditors have a positive role to play in AML, and call for a review of audit Regulation “in the coming months” on “specific requirements regarding statutory audit of public interest entities” to ensure that accountants can continue to play their “critical role” in AML.