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More openness integral to audit reform

Audit rules in Europe, if reformed, must influence increased openness and transparency, in addition to improved audit quality. These are the thoughts heard by those present at a recent European parliament conference.

The possible changes could have a huge impact upon accountants for contractors and other self-employed or business entities.

Sajjad Karim, the MP who was responsible for the audit reform proposals, said:

“We must encourage a much greater degree of transparency and openness, rather than maintain the present opaqueness when important decisions are taken as part of the audit process.

“We need to look to deliver a system which ensures independence, rather than one which enables the continuation of cosy relationships.

“Often when meeting stakeholders and discussing with colleagues…we come up against the problem that a regulation will not be sympathetic to the various national company law traditions and approaches used across the Union.”

Speaking at the conference, which he organised along with European Federation of Finance Services Users, Karim explained how feverishly Parliament worked on reform. He also said that the needs and role of investors should be a key component to the proposed reform.

The MP made the suggestion that regulation is not necessarily as important as perceived in addressing future audit reforms before proposing that a directive may be more effective.

He went on to say that it is often the case when speaking with colleagues and meeting stakeholders, they are confronted with the issue that there will be a regulation that doesn’t adhere to the approaches and traditions of national company law that are known throughout the Union.

Posted by Louise
April 3, 2013
Research & Statistics

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