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Part 42 U.K.Statutory Auditors

Modifications etc. (not altering text)

C2Pt. 42: functions transferred in part (6.4.2008 in accordance with art. 1 of the amending S.I.) by The Statutory Auditors (Delegation of Functions etc) Order 2008 (S.I. 2008/496), art. 4 (which amending S.I. was revoked (2.7.2012) by S.I. 2012/1741, art. 6)

Chapter 6U.K.Supplementary and general

Valid from 06/04/2008

Transfer of papers to third countriesU.K.

1253DRestriction on transfer of audit working papers to third countriesU.K.

Audit working papers must not be transferred to a third country competent authority by any person other than a statutory auditor acting in accordance with rules imposed under paragraph 16A of Schedule 10 (transfer of papers to third countries).

Valid from 15/11/2010

[F1[F21253DATransfer by Secretary of StateU.K.

(1)The Secretary of State may transfer audit working papers to an approved third country competent authority if the following conditions are met (but see also section 1253DD).

(2)The first condition is that the authority has made a request to the Secretary of State for the transfer of the audit working papers.

(3)The second condition is that the audit working papers relate to audits of companies that—

(a)have issued securities in the third country in which the authority is established, or

(b)form part of a group issuing statutory consolidated accounts in that third country.

(4)The third condition is that the authority has entered into arrangements with the Secretary of State in accordance with section 1253E.

Textual Amendments

F1Ss. 1253D-1253F and cross-heading inserted (6.4.2008) by The Statutory Auditors and Third Country Auditors Regulations 2007 (S.I. 2007/3494), reg. 15(1) (with reg. 15(2) (as amended by S.I. 2008/499), reg. 2(4)))

Valid from 15/11/2010

1253DBTransfer by statutory auditor with approval of Secretary of StateU.K.

(1)A statutory auditor may transfer audit working papers to an approved third country competent authority if the transfer is made—

(a)with the prior approval of the Secretary of State, and

(b)in accordance with rules of a recognised supervisory body meeting the requirements of paragraph 16AA of Schedule 10.

(2)The Secretary of State must not approve a transfer of audit working papers to an approved third country competent authority for the purposes of this section unless the following conditions are met (see also section 1253DD).

(3)The first condition is that the authority has made a request to the Secretary of State for the transfer of the audit working papers.

(4)The second condition is that the audit working papers relate to audits of companies that—

(a)have issued securities in the third country in which the authority is established, or

(b)form part of a group issuing statutory consolidated accounts in that third country.

(5)The third condition is that the authority has entered into arrangements with the Secretary of State in accordance with section 1253E.

Textual Amendments

F1Ss. 1253D-1253F and cross-heading inserted (6.4.2008) by The Statutory Auditors and Third Country Auditors Regulations 2007 (S.I. 2007/3494), reg. 15(1) (with reg. 15(2) (as amended by S.I. 2008/499), reg. 2(4)))

Valid from 15/11/2010

1253DCTransfer by statutory auditor for purposes of investigation of auditorU.K.

A statutory auditor may transfer audit working papers to a third country competent authority if the transfer is made—

(a)for the purposes of an investigation of an auditor or audit firm, and

(b)in accordance with rules of a recognised supervisory body meeting the requirements of paragraph 16AB of Schedule 10.

Textual Amendments

F1Ss. 1253D-1253F and cross-heading inserted (6.4.2008) by The Statutory Auditors and Third Country Auditors Regulations 2007 (S.I. 2007/3494), reg. 15(1) (with reg. 15(2) (as amended by S.I. 2008/499), reg. 2(4)))

Valid from 15/11/2010

1253DDAgreement of EEA competent authorityU.K.

(1)This section applies where—

(a)an approved third country competent authority makes a request to the Secretary of State for the transfer of audit working papers which relate to the audit of the consolidated accounts of a group, and

(b)the audit working papers that are the subject of the request—

(i)have been created by the auditor of a subsidiary that is located in another EEA State in relation to the audit of that subsidiary, and

(ii)are in the possession of a statutory auditor.

(2)In the case of a transfer by the Secretary of State under section 1253DA, the transfer must not take place unless the EEA competent authority responsible for the auditor of the subsidiary has given its express agreement to the transfer.

(3)In the case of a transfer by a statutory auditor under section 1253DB, the Secretary of State must not approve the transfer unless the EEA competent authority responsible for the auditor of the subsidiary has given its express agreement to the transfer.

Textual Amendments

F1Ss. 1253D-1253F and cross-heading inserted (6.4.2008) by The Statutory Auditors and Third Country Auditors Regulations 2007 (S.I. 2007/3494), reg. 15(1) (with reg. 15(2) (as amended by S.I. 2008/499), reg. 2(4)))

Valid from 15/11/2010

1253DETransfer by means of inspectionU.K.

(1)This section applies in the case of a transfer of audit working papers if—

(a)it is a transfer to an approved third country competent authority listed in section 1253D(2)(a), (f) or (g),

(b)it is a transfer under section 1253DA or 1253DB, and

(c)it is to take place by means of an inspection in the United Kingdom by the authority.

(2)The Secretary of State must participate in the inspection.

(3)The inspection must be under the leadership of the Secretary of State unless the Secretary of State otherwise permits.]

Textual Amendments

F1Ss. 1253D-1253F and cross-heading inserted (6.4.2008) by The Statutory Auditors and Third Country Auditors Regulations 2007 (S.I. 2007/3494), reg. 15(1) (with reg. 15(2) (as amended by S.I. 2008/499), reg. 2(4)))

1253EWorking arrangements for transfer of papersU.K.

(1)The Secretary of State may enter into arrangements with a third country competent authority relating to the transfer of audit working papers—

(a)from the third country competent authority or third country auditors regulated by that authority to the Secretary of State; and

(b)from statutory auditors to the third country competent authority.

(2)The arrangements must provide that—

(a)the Secretary of State has the rights and duties referred to in subsections (3) to (5) in relation to papers he requests from the third country competent authority or third country auditors, and

(b)the third country competent authority has comparable rights and duties in relation to papers it requests from statutory auditors.

(3)Any request by the Secretary of State for audit working papers from the third country competent authority or a third country auditor must be accompanied by a statement explaining the reasons for the request.

(4)The Secretary of State may use the audit working papers he receives in response to a request only in connection with—

(a)quality assurance functions which meet requirements equivalent to those of Article 29 of the Audit Directive (quality assurance),

(b)investigation or disciplinary functions which meet requirements equivalent to those of Article 30 of the Audit Directive (investigations and penalties), or

(c)public oversight functions which meet requirements equivalent to those of Article 32 of the Audit Directive (principles of public oversight).

(5)The Secretary of State, a person exercising the functions of the Secretary of State and persons employed in discharging those functions must be subject to obligations of professional secrecy in relation to audit papers supplied to the Secretary of State by a third country competent authority or a third country auditor.

1253FPublication of working arrangementsU.K.

If the Secretary of State enters into working arrangements in accordance with section 1253E, he must publish on a website without undue delay—

(a)the name of the third country competent authority with which he has entered into such arrangements, and

(b)the country or territory in which it is established.]

Textual Amendments

F1Ss. 1253D-1253F and cross-heading inserted (6.4.2008) by The Statutory Auditors and Third Country Auditors Regulations 2007 (S.I. 2007/3494), reg. 15(1) (with reg. 15(2) (as amended by S.I. 2008/499), reg. 2(4)))