Gavin Hinks, Accountancy Age, Tuesday 12 October 2010 at 10:42:00

Internal markets commissioner set to publish proposals for regulating audit


A report on the reform of the audit profession is due to be publishedtomorrow with observers expecting proposals that could transform the market forbig audits.

The green paper will come from the EU?s internal markets Michel Barnier.There has been widespread speculation that the paper could propose joint audits.

Auditors are also braced for proposals on how the European Commission couldformalise a much greater role in the regulation of audit.

In a statement earlier this year Barnier said: ?Governments have so farfocused their attention on the urgent measures necessary to stabilise themarkets.

?Now we are entering a less reactive phase and I am convinced that it is theright time to launch a real debate at European level on the subject of audit.

?This conviction is reinforced by the questions recently raised in thecontext of the audit of the accounts of the American bank Lehman Brothers."

Today will also see the start of a House of Lords inquiry into the role ofauditors in the financial crisis and the concentration of the audit market.

First to appear before the Lords' economic affairs committee is Prof StellaFearnley of Bournemouth University. Prof Michael Power of the London School ofEconomics and Prof Vivien Beattie, of Glasgow University.

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