The Companies Act 2014 has some quite strict requirements in respect of the ownership of an audit firm. The law has been reflected in the audit firm ownership rules, with the underlying principle being that the audit firm must be controlled by statutory auditors. There have been suggestions that some of the recent private equity practice buy-out schemes in the UK and Ireland have stretched the definitions, with structures that include voting and non-voting shares. The regulators have also expressed concern about some of the legal structures being put in place. Audit firms holding a UK audit licence will also note the guidance issued by the Financial Reporting Council and the change in firm ownership requirements being implemented in the UK. Accountancy Europe has also published a research report on private equity investments in accountancy firms.
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