Tag: auditing

The European Commission believes it is only "logical" that companies providing cloud services over the Internet face audits on whether they are keeping their promises on personal data security. 

The European Commission said on Wednesday (13 October) that it would propose a reform of the auditing sector next year after the financial crisis uncovered failings in how it operated.

Brussels has presented options on how to protect large auditing firms from unrestricted liability claims as companies increasingly seek legal redress in the wake of the 2002 Enron scandal.

The collapse of Enron in the US and European scandals such as those revolving around Dutch retailer Ahold and Italian agri-food giant Parmalat, all in 2003, forced the issues of corporate governance and financial reporting to the fore in the EU. The Commission therefore began to systematically address these issues through its company law and financial services policies.

Parliament’s legal affairs committee has voted against a controversial proposal requiring special audit committees to oversee company accounts.

To prevent future corporate scandals such as the Parmalat case, EU Member States are being called on to introduce tougher rules for the auditing of company accounts.

On 21 November, the Commission published the results of an online consultation on the Commission's Action Plan designed to modernise company law and enhance corporate governance.

U.S. Securities and Exchange Commissioner Roel Campos indicated on 11 June that the U.S. had no intention of removing the registration requirements for EU audit firms, ordered by the Sarbanes-Oxley Act.

EU Internal Market Commissioner Frits Bolkestein is not shying away from a full-fledged dispute on discriminatory terms in US legislation. He is threatening retaliatory measures against the US unless it allow European auditors unchecked access to US firms.