(2004/C 88 E/0179)

WRITTEN QUESTION E-0187/04

by Brice Hortefeux (PPE-DE) to the Commission

(29 January 2004)

Subject:   Auditing of company accounts

In the light of the most recent scandal to date, which lifted the lid on a EUR 7 billion deficit covered up by Parmalat, the issue of auditing company accounts has returned to the table with particular force.

With tax havens, disguised financial losses, falsified documents and balance sheets, this case has all the ingredients that have characterised previous financial scandals. Even if it is still too early to draw any conclusions from this extremely complex affair, it is useful and necessary to begin examining the consequences it will have for European financial services policy.

Does the Commission intend, therefore, to look at strengthening the legal auditing of accounts by drawing up stricter measures for audit firms, making them responsible for all aspects of consolidated accounts?

Will the legal loophole created when two audit firms are each responsible for part of the accounts be tightened? If so, how will this take place?

Is a ban on auditors' being able to take part in any kind of management decision being considered?

Answer given by Mr Bolkestein on behalf of the Commission

(11 March 2004)

The Commission agrees that it is still too early to draw any final conclusions from the Parmalat corporate failure which is indeed very complex. However, the Commission had already proposed in its Communications of 21 May 2003 on Modernising Company Law and Enhancing Corporate Governance in the EU and on Reinforcing statutory audit in the EU, a number of measures which specifically deal with some of the problems identified in the Parmalat case. In response to this corporate failure, the Commission intends to accelerate some of the proposals contained in these action plans.

As far as statutory audit is concerned, the Commission intends to include a specific provision in its proposal for a modernised Directive which confirms the principle that the statutory auditor can in no way be involved in management decisions. A specific rule will also be introduced that the group auditor bears full responsibility for the audit report in relation with the consolidated accounts.