Companies Act 2014 section 1502

Scope of penalties and publicity in relation to their imposition

Section 1502 sets out the range of penalties that recognised accountancy bodies may impose on statutory auditors and audit firms, the appeal and suspension mechanisms available when approval is withdrawn, and the obligation to publicly disclose penalties and measures taken.

• Penalties available to recognised accountancy bodies include withdrawal of approval to act as a statutory auditor or audit firm, and temporary prohibitions in line with the EU Audit Directive
• Where a disciplinary committee decides to withdraw approval, the withdrawal may be suspended pending the outcome of internal appeals or, where no automatic suspension exists, the auditor or firm may apply to the High Court for a suspension order
• After all internal appeals have been exhausted, the auditor or audit firm may appeal to the High Court, which can grant a suspension of the withdrawal subject to conditions such as supervised auditing
• Recognised accountancy bodies must publicly disclose any measures taken or penalties imposed on auditors or audit firms, in accordance with written criteria approved in advance by the Supervisory Authority

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