The Irish Audit Firm Governance Code

Chartered Accountants Regulatory Board launches Audit Firm Governance Code for firms auditing public interest entities

8 June 2012: The Chartered Accountants Regulatory Board (CARB), the body that regulates members of Chartered Accountants Ireland has today announced the introduction of an Audit Firm Governance Code for auditors of public interest entities.

The Irish Code has been adapted from the Audit Firm Governance Code published in 2010 by the UK’s Financial Reporting Council and the Institute of Chartered Accountants in England and Wales. 

The objective of the Code is to provide a template which boards and shareholders can use to assess a firm’s governance procedures. One of the key elements of the Code is the principle that audit firms should appointment independent non-executives within their governance structures. This is consistent with best practice governance within many types of organisation and should in this instance provide a basis for enhanced dialogue between stakeholders and audit firms. 

While the firms have already taken steps to implement the principles of the Code, including the reporting obligation set out in the Transparency Directive, the Code seeks to reinforce this. 

In advance of finalising the Code, CARB consulted relevant stakeholders including: The Irish Auditing and Accounting Supervisory Authority; The Central Bank of Ireland; The Department of Jobs, Enterprise and Innovation; The Irish Stock Exchange; The Irish Association of Investment Managers; The Irish Business and Employers Confederation. Firms that audit public interest entities were also consulted as part of the year-long process.  

The Code will apply to firms auditing public interest entities where that entity’s financial year commences on or after 1 January, 2013. 

A copy of the Code is available for download from CARB’s website www.carb.ie or by clicking here.