STOP PRESS!
NEW BUSINESSES CAUGHT UNDER ‘PUBLIC INTEREST ENTITY’ (PIE) DEFINITION
"Two consultations, which have just been issued by BIS and the FRC, now clarify the applicability of the new EU Audit Regulation and Directive to smaller and non-quoted financial institutions. The definition of a "Public Interest Entity" is being extended from June 2016 to include all banks and insurance companies of whatever size, where as previously only PLCs and the largest financial institutions were affected. These new PIEs will be subject to the same re-tendering rules, prohibited non-audit services (NAS), 5 year partner rotation and auditor engagement with the audit committee as the largest PLC. From around 2019, they will also be subject to the 70% cap on NAS. This extension of the rules has passed many smaller financial institutions by.

Worse still, the EU Audit Regulation is law and fully applicable in the UK, so breach of these rules is a serious offence. June 2016 is now very close and new PIEs need to understand when the new rules affect them and how. It is quite possible that some will need to organise an audit tender during 2016 so as not to break the law. Audit Review can help. We have a range of services to help firms comply regardless of size and experience".

Who are Audit Review?

Audit Review brings together a team which combines expertise and methodology of tendering professional services with a knowledge of the auditing and regulatory framework.

Lawrence ReedLawrence Reed MA FCA MCIM

Lawrence trained as a Chartered Accountant at the London office of Deloitte. He moved to another top 10 firm where he progressed to Group Audit Manger and then Marketing Director. In this latter role he wrote that firm's audit tender manual, trained the partners in audit tender approaches and supervised all large audit tender responses.

This special insight into both sides of the tender process enables Lawrence to quickly prioritise the key attributes required from a prospective service provider and provide a robust critique of the responses received.

Lawrence has conducted in-depth external audit effectiveness reviews and managed external audit tenders for FTSE 250 companies and advised firms on tender strategy. In his career as a consultant he has assisted many professional firms in responding to tenders, developing tender response protocols and managing the tender of professional services for organisations like J. Sainsbury, The Institute of Chartered Accountants in England & Wales and the National Pharmacy Association.

Lawrence is a Fellow of The Institute of Chartered Accountants in England & Wales and a Member of the Chartered Institute of Marketing. He regularly publishes articles giving insight into the effective management of external audit relationships and the prevailing governance framework.

David YoungDavid Young BA hons FCA CTA

David trained as a Chartered Accountant at the London office of Arthur Andersen (now Deloitte). Following a spell in investment banking, he became finance director of a London Stock Exchange premium -listed company. In this latter role he was a major user of the audit services and non-audit services of a “Big 4” firm as well as having oversight of internal audit. He combines his role at Audit Review with a number of non-executive directorships. He is a past audit committee chair of a FTSE250 insurance group and currently chairs a number of other audit committees of AIM-listed and private financial service groups.

Being a major user of services from the big 4 accountancy firms both as a finance director and non-executive director gives David a special insight into the needs of company Boards and what leads to a strong but constructive external audit relationship and an effective internal audit department. He has an in depth knowledge of the corporate governance codes and standards which cover listed companies and their auditors and how companies and their audit committees are responding to recent changes. David has conducted has in-depth external audit effectiveness reviews provided comfort opinions on an auditor’s independence for FTSE100, FTSE250 and large AIM-listed groups. He has managed external audit tenders for listed companies and advised firms on tender strategy.

David is a Fellow of The Institute of Chartered Accountants in England & Wales and an Associate of the Chartered Institute of Taxation. He is a past deputy chairman of the ICAEW’s NED Group and regularly lectures on corporate governance, risk and assurance issues.