Bolkestein Mulling New Regulations For Auditors

by Ulrika Lomas, for LawAndTax-News.com, Brussels

09 January 2004

According to reports, EU Internal Market Commissioner, Frits Bolkestein is said to be considering reforms to the rules governing auditors, in the wake of the collapse of Italian dairy giant, Parmalat.

The Financial Times on Thursday suggested that Mr Bolkestein may seek to make group auditors responsible for all aspects of companies' accounts, quoting a spokesman for the Commissioner, who explained that:

"This would mean that problems don't fall between two stools, with the left hand not knowing what the right hand is doing."

Accounting firm, Deloitte SpA is understood to be facing questioning over its auditing of Parmalat's group accounts. However, under Italian law, auditors currently need only verify 51% of a group's overall assets and liabilities, with the remaining 49% being the responsibility of the individual auditors of subsidiaries.

According to the FT, the Commission is also considering requiring European Union member states to establish US-style accounting oversight boards.

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