Statutory auditor meaning

Under Irish legislation, each company is required to have its financial statements examined by a statutory auditor, except where it qualifies for, and uses, an exemption. Until recently, per section 363 of the Companies Act 2014 (Ireland) (CA 2014 (IRL)), a company that did not submit its annual return within 56 days of its annual return date forfeited the ability to rely on this exemption for the subsequent two years, effectively as a sanction for late filing...

Original news FCA fines PwC £15m for failure to report LCF concerns, LNB News 16/08/2024 21. Background In August 2024, the FCA levied a £15m penalty on PwC over its audit work on LCF, arising from issues connected to that engagement. LCF was a financial services company that offered minibonds to retail investors, positioning the products to individual savers. After the FCA intervened in December 2018 over LCF’s minibond marketing practices, the company entered administration in January 2019, causing heavy losses for thousands of investors and widespread detriment. Before administration, LCF had sold minibonds to more than 11,000 investors, with an aggregate face value of around £237m, reflecting the scale of its distribution. LCF’s failure has prompted various civil, criminal and regulatory proceedings, among them an SFO criminal inquiry into suspected fraud and money laundering offences, alongside other related actions. PwC served as LCF’s statutory auditor for the year to 30 April 2016, a time of swift growth in its minibond activities that intensified audit complexity. However, the...

There are statutory rules governing a company’s auditor liability and the extent to which it can be curtailed. Before 6 April 2008, a company was prohibited from excusing or indemnifying its auditors for any negligence, default, breach of duty, or breach of trust connected with the company that arose in carrying out the audit of the accounts. That prohibition has since changed, and such protection is now allowed, so long as it is either an indemnity covering the costs of successfully defending proceedings or a liability limitation agreement. Furthermore, additional requirements concerning an auditor’s liability and its caps may apply to a listed company, an AIM company, or a company whose securities are listed on the AQSE Main Market, AQSE Growth Market, or AQSE Trading (previously the NEX Exchange Main Board, NEX Exchange Growth Market, and NEX Exchange Secondary Market), though those matters fall outside the ambit of this Practice Note. Some or all of the statutory measures addressing auditors and liability limitation agreements may equally extend to other companies...

Background There are statutory provisions on the notices and statements that must be given on an auditor ceasing to hold office. Section 18 and Schedule 5 of the Deregulation Act 2015 (DA 2015), which came into force on 1 October 2015, introduced a number of changes in relation to auditors, which include the statutory provisions dealing with the notices and statements required on an auditor ceasing to hold office. The amendments have effect in relation to financial years beginning on or after 1 October 2015. For the purpose of the notices and statements required on an auditor ceasing to hold office, DA 2015 amended the Companies Act 2006 (CA 2006) to make a distinction between public interest companies and non-public interest companies (each being treated slightly differently), rather than the distinction between quoted companies and unquoted companies (again, each being treated slightly differently) which applied before DA 2015 amended the CA 2006...

Background This Practice Note outlines the statutory framework contained in the Companies Act 2006 (CA 2006), alongside other legislation, concerning the terms of an auditor’s appointment and the setting of an auditor’s remuneration and related matters. It also notes that additional rules on the terms of an auditor’s appointment and remuneration may apply to a listed company, an AIM company, or a company whose securities are admitted to the AQSE Main Market or the AQSE Growth Market (formerly the NEX Exchange Main Board or NEX Exchange Growth Market), but these fall beyond the scope of this Practice Note. For guidance on how an auditor is appointed (including the mandatory tender requirements that apply to public interest entities), see Practice Note: Appointment of an auditor, and for a form of resolution, see Precedent: Resolution to appoint or re-appoint an auditor and fix their remuneration. For guidance regarding the appointment of an auditor where there has been a failure to re-appoint, see Practice Note: Failure to re-appoint an auditor. For further...

Part 1, interpretation and limitation of liability Unless the context requires otherwise, these articles use terms defined in the Companies Act 2006 (and any amending or subordinate legislation) and within these articles. Defined terms include: address; articles; bankruptcy (including similar overseas procedures); chair and chair of the meeting (articles 13 and 30); Companies Acts; director (including anyone acting as such); document (including electronic); electronic form/means and hard copy form; instrument; member; ordinary and special resolutions; eligible director; participate; proxy notice; relevant officer (non‑auditor officers of the company or any group undertaking, present or former); subsidiary; and writing (any visible representation, including electronic) The model articles are excluded. Unless otherwise stated, statutory expressions bear the meaning they had when these articles became binding. References to legislation include any modification, re‑enactment or replacement. Singular includes plural and vice versa; masculine includes feminine and neuter; persons include corporations Each member’s liability is limited to £1, payable on a winding up while a member or within one year of ceasing, towards:...