Financial Audit has lived for the last few years a legislative wave, as it was first nicknamed, an upwelling of law changes caused by the serious economical crisis.
24 june 2016
Thus, from 2006 and regarding Financial Audit, two community directives, community regulations, two laws, a rewritten text, rules procedure and we hope that a new Financial Audit Regulation is approved soon.
The latest update was the entry into force, last 17 June, of the Law 22/2015 of 20 July regarding Financial Audit Law, repealing the Rewritten Text which was in force until then. Complying with our duties as a Member State of the European Union, with this new Law, the transposition of the Directive 2014/56/EU has been carried out and some of the options of the Regulation (EU) 573/2014 for Public Interest Entities have been integrated.
With this new Law, the transposition of the Directive 2014/56/EU has been carried out and some of the options of the Regulation (EU) 573/2014
The objective of this Law, in line with the aforementioned, is to improve the quality and reinforce the credibility of Financial Audit. For that aim, the Law’s main innovations are the emphasis on professional scepticism that must preside the auditor’s action, some modifications on the regime that regulates the independence of the auditor or measures that try to limit the economic dependence of the auditor before the client.
All the Audit firms are urged to implement an quality control intern system that allows to detect and correct the threats to independence or the errors when issuing reports.
The new Law also incorporates a chapter dedicated to the Public Interest Entities where, among other measures, they signal the additional service catalogue that the auditor cannot provide or the establishment of rotation periods of the responsible partner and of the audit firm. Furthermore, new communication ways are established with regulating organisations, as new reports are being set which need to be sent to the ICAC and to the supervisory agencies of the Public Interest Entities.
The new Law also incorporates a chapter dedicated to the Public Interest Entities where, among other measures, they signal the additional service catalogue that the auditor cannot provide
Finally, another new update is the new format of the audit report, with more informative content, specially regarding the risks noticed by the auditor.
So we need to keep up with academic training if we want to stay afloat in the tidal wave that audit regulation is.
