Vinsamlegast notið þetta auðkenni þegar þið vitnið til verksins eða tengið í það: http://hdl.handle.net/1946/14451
In 2010 the European Commission released a discussion paper entitled ‘Green Paper: Lessons from the crisis’ in which they expressed the need to reinforce the audit system in order to help prevent future financial failure. Regarding the issue of auditor independence, the European Commission suggested further legislation to reinforce professional scepticism, mandate the rotation of audit firm and prohibit the provision of non-audit services. A high portion of the 700 responses to the Green Paper received opposed these suggestions. The Commission subsequently presented proposals for amendments to the existing audit directive and for a new regulation.
This research set out to investigate the reason for the opposition, to establish whether there is a markedly different opinion between the different players of the financial market, and to prove or disprove the existence of a ‘divide’ between the legislator and the members of the audit profession. The research was performed in two parts, with analysis of the responses to the Green Paper and subsequent interviews with members of the financial market.
Analysis of the responses found an overwhelming degree of opposition from all of the participants, presenting the hypothesis that the European Commission is exceeding its authority with insufficient regard for the principles of subsidiarity and proportionality; “going too far” with legislative action. Analysis of the interviews, however, found the participants representing the audit profession to be more opposed than the other participants. In consolidating the results, the degree of support voiced by the interviewees is outweighed by the extreme opposition in the overall research.
The existence of the ‘divide’ was ultimately disproved by the fact that the overall opposition is not limited to the members of the audit profession, but is demonstrated equally by all of the members of the financial market. These findings suggest the presented hypothesis to be true and present evidence that the European Commission is indeed “going too far”.
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