The Second Chamber of the Dutch parliament has discussed proposals for a new Accountants Act (Wet op het Accountantsberoep). This Bill was submitted last year and is aimed at merging the professional organisations NIVRA and NOvAA into one professional organisation: the Netherlands Institute of Chartered Accountants (NBA).
The parliamentary discussions about this Bill have also led to amendments to the Audit Firms Supervision Act (Wet toezicht accountantsorganisaties). These amendments, already passed by the Second Chamber, would drastically change the accountancy market:
- Audit only: accountancy firms auditing organisations of public interest may not also do other types of work for those organisations. These organisations - referred to as "OOBs" - include all listed companies as well as non-listed banks and insurers. Only a very limited number of specified services may be provided by auditors, such as auditing interim financial statements and providing certainty with regard to the managing board's report, the corporate governance report, the risk management report, and the corporate social responsibility report.
- Compulsory rotation of accountancy firms: OOBs will have to rotate their auditors after eight years. This means not just changing the individuals but the actual firm. A two-year cooling-off period applies to the firm in charge of the statutory audits. The legislators' aim is to create a transitional period by making this provision operational at a later date ⦣8364;" 1 January 2014 ⦣8364;" than the other provisions of the amended Act.
- Compulsory notification to the AFM: OOBs must notify the AFM of an intended selection of auditor.
- No Chinese walls: the Chinese walls at the AFM between supervision of accountancy firms and supervision of financial reporting will be removed. The AFM will be given additional powers to assist its supervision of financial reporting.
The amendments are yet to be discussed in the First Chamber of parliament.
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