The Companies (Statutory Audits) Act 2018 (2018 Act) was signed into law in July 2018 and most sections commenced on the 21st September, amending the Companies Act 2014.
Section 51 of the 2018 Act inserts a new Part 27 into the Companies Act 2014 which largely deals with the regulation of statutory auditors (this was previously contained within SI 312 of 2016). The independence of statutory auditors is a key element of the legislation (as it was under the 2016 Regulations).
The legislation sets out the general requirements for independence and also sets out a number of prohibited relationships for a statutory auditor, necessary to secure independence. Relationships such as acting as auditor whilst also an officer of or servant of the company or whilst a specified family member of an officer of the company or while in the employment of the audit client are prohibited by law. Prohibited relationships including the holding of financial or beneficial interests are also provided for.
S.1538 of the amended Companies Act 2014 requires that threats to independence and the safeguards be recorded in the audit working papers.
S.1539 requires that the statutory auditor assess and document their compliance with the independence requirements of the Companies Act 2014 in advance of the acceptance or continuance of the audit engagement.
Further independence requirement are also contained in the Ethical Standard for Auditors (Ireland) 2017.