ETHICS AND INDEPENDENCE OF THE STATUTORY AUDITORS
LexInter | August 23, 2003 | 0 Comments

ETHICS AND INDEPENDENCE OF THE STATUTORY AUDITORS

Article L822-9

(inserted by Law n ° 2003-706 of August 1, 2003 art. 104 I Official Journal of August 2, 2003)
   The functions of auditor are exercised by natural persons or companies formed among themselves in any form whatsoever.
Three quarters of the capital of statutory auditors is held by statutory auditors. When a company of auditors has a stake in the capital of another company of auditors, the shareholders or partners who are not auditors may not hold more than 25% of the total capital of the two companies. The functions of manager, chairman of the board of directors or of the management board, chairman of the supervisory board and chief executive officer are performed by auditors. At least three quarters of the members of the management, administration, management or supervisory bodies and at least three quarters of the shareholders or partners must be auditors. The permanent representatives of the companies of associated or shareholder auditors must be auditors.
In the companies of registered auditors, the functions of auditor are exercised, on behalf of the company, by auditors who are natural persons associated, shareholders or managers of this company. These people can only exercise the functions of statutory auditors within a single statutory auditor company. The members of the board of directors or of the supervisory board may be employees of the company without limitation of number or condition of seniority in respect of the quality of employee.
In the event of the death of a shareholder or associate auditor, his successors have a period of two years to transfer their shares or shares to an auditor.
The admission of any new shareholder or partner is subject to prior approval which, under the conditions provided for by the articles of association, may be given either by the meeting of shareholders or unitholders, or by the board of directors or the supervisory board or managers as the case may be.
By way of derogation from these provisions, the exercise of these functions is possible simultaneously within a company of auditors and another company of auditors, the first of which holds more than half of the share capital or in the case of where the partners of the two entities are common for at least half of them.

Article L822-10

(inserted by Law n ° 2003-706 of August 1, 2003 art. 104 I Official Journal of August 2, 2003)

The functions of auditor are incompatible:
1 ° With any activity or act likely to undermine his independence;
2 ° With any paid employment; however, an auditor may provide education related to the exercise of his profession or take up paid employment with an auditor or a chartered accountant;
3 ° With any commercial activity, whether carried out directly or through an intermediary.

Article L822-11

(Law n ° 2003-706 of August 1, 2003 art. 104 II Official Journal of August 2, 2003)
(Ordinance n ° 2005-1126 of September 8, 2005 art. 13 Official Journal of September 9, 2005)

I. – The statutory auditor may not take, receive or maintain, directly or indirectly, an interest in the person or entity whose accounts he is responsible for certifying, or in a person who controls him or who is controlled by it, within the meaning of I and II of article L. 233-3.
Without prejudice to the provisions contained in this book or in book II, the code of ethics provided for in article L. 822-16 defines the personal, financial and professional links, concomitant or prior to the mission of the auditor, incompatible with the exercise of it. It specifies in particular the situations in which the independence of the auditor is affected, when he belongs to a multidisciplinary network, national or international, whose members have a common economic interest, by the provision of services to a person. or to an entity controlled or which controls, within the meaning of I and II of Article L. 233-3, the person or entity whose accounts are certified by the said auditor. The code of ethics also specifies the restrictions to be placed on the holding of financial interests by the employees and collaborators of the auditor in companies whose accounts are certified by him.
II. – The statutory auditor is prohibited from providing to the person or entity which has instructed him to certify his accounts, or to the persons or entities which control him or which are controlled by him within the meaning of I and II of the same article, any advice or any other provision of services not falling within the diligence directly related to the mission of the statutory auditor, as defined by the professional standards mentioned in the sixth paragraph of the article L. 821-1.
When an auditor is affiliated with a national or international network, the members of which have a common economic interest and whose exclusive activity is not the statutory audit of accounts, he cannot certify the accounts of a person or ” an entity which, by virtue of a contract concluded with this network or a member of this network, benefits from the provision of services, which is not directly linked to the mission of the auditor according to the assessment made by the High Council of the Statutory Auditors in application of the third paragraph of Article L. 821-1.

Article L822-12

(Law n ° 2003-706 of August 1, 2003 art. 104 II Official Journal of August 2, 2003) 
(Ordinance n ° 2005-1126 of September 8, 2005 art. 14 Official Journal of September 9, 2005)

The statutory auditors and the signatory members of a company of statutory auditors cannot be appointed managers or employees of the persons or entities they control, less than five years after the end of their functions.
During this same period, they cannot exercise the same functions in a person or entity controlled or which controls, within the meaning of I and II of Article L. 233-3, the person or entity whose accounts they have certified.

Article L822-13

(Law n ° 2003-706 of August 1, 2003 art. 104 II Official Journal of August 2, 2003)
(Ordinance n ° 2005-1126 of September 8, 2005 art. 15 Official Journal of September 9, 2005)

People who have been managers or employees of a person or entity cannot be appointed as statutory auditors of this person or entity less than five years after leaving office.
During the same period, they may not be appointed as statutory auditors of persons or entities owning at least 10% of the capital of the person or entity in which they exercised their functions, or of which the latter owned at least 10% of the capital. capital upon termination of their functions.
The prohibitions provided for in this article for the persons or entities mentioned in the first paragraph are applicable to the statutory audit companies of which said persons or entities are associates, shareholders or managers.

Article L822-14

(Law n ° 2003-706 of August 1, 2003 art. 104 II Official Journal of August 2, 2003) 
(Ordinance n ° 2005-1126 of September 8, 2005 art. 16 Official Journal of September 9, 2005)

The statutory auditor, who is a natural person, as well as the signatory member of a company of statutory auditors, is prohibited from certifying the accounts of persons and entities making public offerings for more than six consecutive financial years.
This provision is also applicable to the persons and entities referred to in Article L. 612-1 and to the associations referred to in Article L. 612-4 when these persons appeal to public generosity.
 

Article L822-15

(Law n ° 2003-706 of August 1, 2003 art. 104 II Official Journal of August 2, 2003) 
(Law n ° 2005-845 of July 26, 2005 art. 162 V Official Journal of July 27, 2005 in force on January 1, 2006 subject to art. 190)
(Ordinance n ° 2005-1126 of September 8, 2005 art. 22 Official Journal of September 9, 2005)

Subject to the provisions of Article L. 823-12 and specific legislative provisions, the statutory auditors, as well as their employees and experts, are bound by professional secrecy for the facts, acts and information of which they may have become aware of. because of their duties. However, they are released from professional secrecy with regard to the president of the commercial court or the tribunal de grande instance when they apply the provisions of Chapter IV of Title III of Book II or of Chapter II of Title I of Book VI .
When a legal person draws up consolidated accounts, the auditors of the consolidating legal person and the auditors of consolidated persons are, with regard to each other, released from professional secrecy. These provisions also apply when a person establishes combined accounts.

Article L822-16

(Law n ° 2003-706 of August 1, 2003 art. 104 II Official Journal of August 2, 2003)
(Ordinance n ° 2005-1126 of September 8, 2005 art. 17 Official Journal of September 9, 2005)

A Council of State decree approves a code of ethics for the profession, after consulting the High Council of the Statutory Auditors and, for the provisions applying to auditors working with persons and entities making public offerings. , of the Autorité des marchés financiers.

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