Companies Act 2014

F618 [ Prohibited relationships - specific provisions to secure independence

1535.

1535. (1) A statutory auditor or audit firm shall not carry out a statutory audit if there is any threat of self-review, self-interest, advocacy, familiarity, or intimidation, created by any direct or indirect financial, personal, business, employment or other relationship between

(a) the statutory auditor or audit firm or network to which he or she belongs or any individual in a position to influence the outcome of the statutory audit, and

(b) the audited undertaking,

as a result of which an objective, reasonable and informed third party, taking into account the safeguards applied, would conclude that the statutory auditor s or audit firm s independence is compromised.

(2) Without prejudice to the generality of subsection (1) , a person shall not act as a statutory auditor of an undertaking if he or she is

(a) an officer or servant of the undertaking,

(b) a person who has been an officer or servant of the undertaking within a period in respect of which accounts would fall to be audited by the person if he or she were appointed auditor of the undertaking,

(c) a parent, spouse, brother, sister or child of an officer of the undertaking,

(d) a person who is a partner of or in the employment of an officer of the undertaking,

(e) a person who is disqualified under this subsection for appointment as auditor of a body corporate that is a subsidiary or holding undertaking of the undertaking or a subsidiary of the undertaking s holding undertaking, or would be so disqualified if the body corporate were a company, or

(f) a person in whose name a share in the undertaking is registered, whether or not that person is the beneficial owner of the share.

(3) Without prejudice to the generality of subsections (1) and (2) , a statutory audit firm, regardless of its legal structure, shall not carry out a statutory audit of an undertaking if

(a) any principal of the audit firm is an officer or servant of the undertaking,

(b) any principal of the audit firm has been an officer or servant of the undertaking within a period in respect of which accounts would fall to be audited by the firm if the firm was appointed auditor of the undertaking, or

(c) the firm is disqualified under this subsection for appointment as auditor of any other body corporate that is a subsidiary or holding undertaking of the undertaking or a subsidiary of the undertaking s holding undertaking, or would be so disqualified if the body corporate were a company.

(4) Without prejudice to the generality of subsections (1) to (3) , a person shall not carry out a statutory audit of an undertaking on behalf of a statutory audit firm if he or she is

(a) a person in whose name a share in the undertaking is registered, whether or not that person is the beneficial owner of the share, or

(b) a parent, spouse, brother, sister or child of an officer of the undertaking. ]

Annotations

Amendments:

F618

Inserted (21.09.2018) by Companies (Statutory Audits) Act 2018 (22/2018), s. 51, S.I. No. 366 of 2018.