Comments on ''Consultation on Implementation of Article 45 - 47 of the Directive on Statutory Audit''

The Financial Services Agency (FSA), together with Certified Public Accountants and Auditing Oversight Board (CPAAOB), submitted a comment letter dated 5 March 2007, to the European Commission (EC), in response to the ''Consultation for the implementation of Article 45 - 47 of the Directive on Statutory Audit''.
According to the Directive, as from the end of June 2008, third country auditors and audit entities that audit third country issuers listed in the EU market are required to be registered with relevant EU Member States authorities and to be subject to their oversight, unless they are subject to the ''equivalent'' oversight in the respective third countries.
The consultation document seeked comments on possible measures under the Directive regarding (a) regulation and oversight of third country auditors and audit entities (Articles 45 and 46 of the Directive); and (b) co-operation with competent authorities from third countries (Article 47).
The comments include, among others, the following points:

To encourage the EC to maintain the openness of the EU market, while protecting the interest of investors;
To support the approach suggested by the EC for the equivalence assessment, which focuses on auditor oversight systems;
To encourage the EC to ensure that a unified application among the EU Member States to be extended to both the equivalence assessment and registration requirements, and to discourage each Member State to resort to their discretions;
To request the EC to exempt Japanese auditors and audit entities from registration requirements, as the auditor oversight system in Japan is no less effective and comprehensive than those required by the Directive.

Japan's Financial Services Agency: Comments On ''Consultation On Implementation Of Article 45 - 47 Of The Directive On Statutory Audit''