In May 2009 the UK Treasury Select Committee published a report entitled 'Banking Crisis: reforming corporate governance and pay in the City'. In this report the Committee called for the appropriateness of the provision of non-audit services by auditors to the entities that they audit to be revisited, saying: "We strongly believe that investor confidence, and trust in audit would be enhanced by a prohibition on audit firms conducting non-audit work for the same company, and recommend that the Financial Reporting Council consult on this proposal at the earliest opportunity".
In response to the Treasury Select Committee's recommendation, the APB has this week issued a Consultation Paper providing relevant background information and inviting views on this important issue.
The consultation paper does not address issues specific to individual non-audit services. For example, in the light of recent market developments, the APB is currently reviewing its existing Ethical Standards relating to audit firms jointly providing internal and external audit services and the FRC's Audit Inspection Unit is considering the application in its ongoing monitoring work of APB's current standards relevant to this issue.
Click here to download the consultation paper.
The consultation period endson the 29th January 2010.