The International Accounting Standards, Statutory Auditors and Third Country Auditors (Amendment) (EU Exit) Regulations 2020

EXPLANATORY NOTE

(This note is not part of the Regulations)

These Regulations amend the International Accounting Standards and European Public Limited-Liability Company (Amendment etc.) (EU Exit) Regulations 2019 (S.I. 2019/685) (“the IAS SI”) and the Statutory Auditors and Third Country Auditors (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/177) (“the Audit SI”).

These Regulations are made in exercise of the powers conferred by section 8(1) of the European Union (Withdrawal) Act 2018 (c. 16), and address failures of retained EU law to operate effectively (in particular under paragraphs (d) and (g) of section 8(2) of the Act) arising from the withdrawal of the United Kingdom from the European Union.

Regulation 4 applies to undertakings preparing their accounts as provided for under Part 15 of the Companies Act 2006 (c. 46) which have their financial year beginning before but ending on or after IP completion day, or which have a financial year ending before IP completion day but may file their accounts after that date. It allows these undertakings to additionally use international accounting standards that are adopted by the UK after the end of the implementation period.

Regulation 5 corrects an error in the IAS SI.

Regulation 7 makes a consequential amendment to the Audit SI as a consequence of changes made by the Statutory Auditors, Third Country Auditors and International Accounting Standards (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/1392).

Regulation 8 amends the audit SI to omit subparagraph 3 of Article 21 of Regulation (EU) No. 537/2014 of the European Parliament and of the Council of 16 April 2014 on specific requirements regarding statutory audit of public-interest entities and repealing Commission Decision 2005/909/EC (OJ No. L 158, 27.05.2014, p. 77) (“the Audit Regulation”). The regulation removes the subparagraph from the Audit Regulation as its provisions have already been implemented in domestic legislation.

Regulation 9 amends Schedule 3 to the Audit SI to revoke retained direct EU legislation that is no longer needed.

An impact assessment has not been produced for this instrument as no, or no significant, impact on the private, voluntary or public sector is foreseen.