The latest EU audit reform has expanded the audit committee’s role substantially. The audit committee is now instrumental in strengthening confidence in the statutory audit and in financial information as a whole. Overall, the audit committee is expected to become a key factor within the corporate governance framework of EU Member States.
This FEE briefing paper highlights the developing role of the audit committee in Europe and provides an overview of the related changes to corporate governance best practice. The paper also provides for a number of FEE recommendations. For the sake of completeness these recommendations have been summarised at the end of the paper.
As the deadline for transposing the legislation is getting closer (16 June 2016), a high level of coordination amongst all stakeholders (board and audit committee members, audited company management, shareholders, and auditors) will facilitate achieving the desired outcomes. Working towards consistent functioning of audit committees across Europe remains crucial in order to achieve the desired outcomes.