Wednesday, 24 March 2021

European Union: the Statutory Audit Directive - Article 22 - "Employment by audited entities of former statutory auditors or of employees of statutory auditors or audit firms"

The Court of Justice of the European Union delivered its judgment today in A (Company law - Statutory audit of annual and consolidated accounts - Judgment) [2021] EUECJ C-950/19. The case concerned - as its name suggests - the Statutory Audit Directive 2006/43/EC (as amended by Directive 2014/56/EU), more specifically Article 22a which imposes a time-based bar on a statutory auditor, or key audit partner, taking up a position with a former audit client. The court held that a position for the purposes of Article 22(a)(1)9a) would be regarded as being held from the point at which the employment contract was agreed and not from when the duties associated with the position had begun to be performed.

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