Company Law Reform Bill [HL]

My Lords, I start by dealing with the specific question on Amendment No. 370 concerning which body is the appropriate audit authority in relation to a major audit. We believe that, where that delegation has taken place, it is the body to which the Secretary of State has delegated that function, which I think would now be the POB—the ““A”” has recently disappeared from its title. So we believe that there should be no confusion or duplication with the various flows going in two different routes, as the noble Baroness suggested might arise. I shall speak to Amendments Nos. 360, 361, 362, 498 and 500 and respond to the other amendments in this group that have already been spoken to. I shall move Amendment No. 360 and so on in due course. We have brought our amendments forward having reflected on the debate on Clause 513 in Grand Committee in relation to amendments similar to those to which the noble Baroness has spoken. Clause 513 introduces new requirements about the statements that auditors and companies must send to the appropriate audit authority when an auditor’s appointment comes to an end. That is in line with the EU audit directive, which was agreed last year and formally adopted on 25 April. Debate in Grand Committee revealed that the clause is confusing in conflating the duties on the auditor and the company, and the purpose of the new clauses introduced by Amendments Nos. 361 and 362 is to set out these duties separately and clearly. The first new clause deals with the auditor’s duty to inform the audit authority when he ceases to be auditor of a company and divides it into two categories, based on the type of company being audited. If it is a listed company, or another company of major public interest according to criteria issued by the Financial Reporting Council, all statements should be sent to the Secretary of State or to the body to which he has delegated auditor supervisory functions. As that delegation has taken place, it would be to the Professional Oversight Board.