On 3 February, EIOPA published a Consultation Paper on the Proposal Guidelines facilitating an effective dialogue between insurance supervisors and auditors that carry out statutory audits of (re)insurance companies (Draft Guidelines). The Draft Guidelines relate to the provisions on encouraging an effective dialogue as provided for in the Audit Regulation (Regulation (EU) No 537/2014).
The Draft Guidelines propose that competent authorities should ensure that dialogue between statutory auditors and the audit firms carrying out statutory audits is open and constructive and, in addition, is flexible enough to ensure it can accommodate unexpected developments in the future. The Guidelines state that competent authorities should promote the mutual understanding of the roles and responsibilities of the parties involved in line with the requirements on confidentiality and professional secrecy laid down in the Audit Regulation and Solvency II. Articles 68 and 72 of Solvency II set out legal requirements of statutory auditors to report promptly facts which are likely to have a serious effect on the financial situation or administrative organisation of a (re) insurance undertaking. Supervisory and auditor tasks can be supported by an effective dialogue between supervisors and statutory auditors.
The draft Guidelines set out relevant principles dealing with the nature of the information to be exchanged, the form, the frequency and timing as well as the representatives involved in these dialogues. The consultation will end on 28 April 2016.
A link to the Draft Guidelines is here