1. Christian Bauch, Head of Unit REPARIS Conference Vienna, 15 March 2006
Public Oversight on Statutory Auditors An element to strengthen confidence in the work of auditors
Christian Bauch, Head of Unit
REPARIS Conference
Vienna, 15 March 2006

2. Introduction
Ongoing international discussions and regulatory changes regarding independent and effective oversight on auditors (USA :PCAOB (2002) but also UK, France, Germany, Japan, Canada, Australia etc.)
New EU requirements regarding oversight on auditors: New 8th Directive on Statutory Audits / Principles of Public Oversight (adopted in 10/2005; to be transposed within 24 months)
The German example: Adaptation of the German Oversight System in late 2004 in line with the new EU Principles of Public Oversight

3. Compliance with the new EU Directive on Statutory Audits
Principles of Public Oversight (Article 31):
all statutory auditors subject to public oversight
governed by a majority of non-practitioners
ultimate responsibility for approval, registration, adoption of standards on ethics, internal quality control and auditing, continuous education, quality assurance and investigative and disciplinary systems
right to conduct investigations and to appropriate actions
transparent (annual work program and activity reports)
adequate funding secure and free from any undue influence by the profession

4. Adaptation of the German system: The Former System of Public Oversight
Federal Ministry of Economics and Technology
governmental supervision
Chief Public Prosecutor
and
Independent Courts
Chamber of Public Accountants (WPK) Corporation under Public Law (since 1961)
transfer of severe cases
organizes examination, approval, registration, disciplinary proceedings, quality assurance; objective funding mechanism
investigations and disciplinary proceedings
Auditors and Audit Firms Mandatory Members of the Chamber of Public Accountants (WPK)

5. Adaptation of the German system: The Revised System of Public Oversight
Federal Ministry of Economics and Technology
governmental supervision
appoints members
Auditor Oversight Commission (AOC) 6 to 10 non-practitioners
Chief Public Prosecutor
and
Independent Courts
public oversight (ultimate responsibility including right to instruct and overrule); transparent reporting
Chamber of Public Accountants (WPK) Corporation under Public Law (since 1961)
transfer of severe cases
organizes examination, approval, registration, disciplinary proceedings, quality assurance;
objective funding mechanism
investigations and disciplinary proceedings
Auditors and Audit Firms Mandatory Members of the Chamber of Public Accountants (WPK)

6. Contact
Tim Volkmann Head of International Affairs Wirtschaftsprüferkammer K.d.ö.R. (WPK) - Chamber of Public Accountants Rauchstrasse 26, D Berlin Germany Tel.: +49 (0) Fax: +49 (0)