The UK Competition and Markets Authority (CMA) has launched a public consultation on a draft order which, once finalised, will put into force some of the changes proposed by the Competition Commission’s (CC’s) investigation in to the UK statutory audit market.
The CC published its final report last October and introduced requirements such as a 10-year mandatory retendering of audit for the FTSE 350 companies, in addition to measures to strengthen the influence of the company’s audit committee over provision of audit services.
On 1 April 2014, the functions of the CC transferred to the Competition and Markets Authority (CMA) according to the Enterprise and Regulatory Reform Act 2013.
The draft order, The Statutory Audit Services for Large Companies Market Investigation (Mandatory Use of competitive Tender Processes and Audit Committee Responsibilities) Order 2014, will be out for consultation until August 2014. And CMA expects the order to apply for financial years beginning on or after 1 January 2015.
"It is not intended that there should be any further transitional period in relation to any of the provisions contained within the Order," the order read.
Mandatory retendering every 10 years hits UK FTSE350
The Statutory Audit Services for Large Companies Market Investigation (Mandatory Use of competitive Tender Processes and Audit Committee Responsibilities) Order 2014