Much to the chagrin of the audit profession globally, the European Parliament has finalized audit reform measures that limit the number of years a public interest entity can employ the same audit firm and restrict what non-audit services may be performed by auditors.
The new rules require public interest entities — which include public companies and a number of other entities that are deemed important to public interests, like banks or insurers — to put their audit out for bid at least every 10 years. If that tendering leads to the retention of the existing audit firm, the company won’t be permitted to rehiring that same firm after 20 years.
