The planned reform of audit requirements in Sweden is causing a debate amongst firms surveyed in this year’s IAB Sweden survey (see A smorgasbord of opportunity).
At present, all limited companies in Sweden are liable for statutory audits but a government committee is working on changes to the legislation that will place a threshold on the size of companies that require an audit. Most EU member-countries have chosen to exempt small companies from the statutory audit requirement and similar moves in Sweden could have a significant impact as there are about 320,000 limited companies and the overwhelming majority of these are SMEs.
Grant Thornton Sweden managing partner Peter Bodin said the reforms could have a positive effect on the firm and the entire Swedish audit profession.
“Yes, of course [the audit reforms] will affect us and everybody else,” he said. “I think it will affect us in a mostly positive way but it’s going to be a big challenge for our profession and all the companies in Sweden to handle that change. There will be many questions from a lot of people like, how should they work with their auditors and advisor services in the future? I think it will have a big change, but I feel comfortable that we will be able to handle that. Other countries have made the same change and they have coped well. In the UK market it was good for the business that the threshold went up.”
Uncertain future Although the threshold has not yet been set by the government, some firms remain dubious about the impact the proposed changes could have on the audit profession.
Baker Tilly Sverige managing partner Thomas Olofsson said: “At present we are trying to attract new firms to Baker Tilly in Sweden, but this is hard when you don’t really know what the threshold is going to be. On one hand the government is telling auditors that they must do this and this and then on the other hand they are telling auditors that their services are no longer needed.”