The Companies Act 2006 (Transfer of Audit Working Papers to Third Countries) Regulations 2010

Transfer of audit working papers to third countries

2.  For section 1253D of the Companies Act 2006 (restriction on transfer of audit working papers to third countries)(1) substitute—

“1253D    Restriction on transfer of audit working papers to third countries

(1) Audit working papers must not be transferred to a third country competent authority except in accordance with—

(a) section 1253DA (transfer by Secretary of State),

(b) section 1253DB (transfer by statutory auditor with approval of Secretary of State), or

(c) section 1253DC (transfer by statutory auditor for purposes of investigation of auditor).

(2) The following are approved third country competent authorities for the purposes of this Part—

(a) the Australian Securities and Investments Commission;

(b) the Canadian Public Accountability Board;

(c) the Certified Public Accountants and Auditing Oversight Board of Japan;

(d) the Financial Services Agency of Japan;

(e) the Federal Audit Oversight Authority of Switzerland;

(f) the Public Company Accounting Oversight Board of the United States of America;

(g) the Securities and Exchange Commission of the United States of America.

(3) Nothing in the sections referred to in subsection (1) authorises the making of a disclosure in contravention of the Data Protection Act 1998(2).

1253DA    Transfer by Secretary of State

(1) The Secretary of State may transfer audit working papers to an approved third country competent authority if the following conditions are met (but see also section 1253DD).

(2) The first condition is that the authority has made a request to the Secretary of State for the transfer of the audit working papers.

(3) The second condition is that the audit working papers relate to audits of companies that—

(a) have issued securities in the third country in which the authority is established, or

(b) form part of a group issuing statutory consolidated accounts in that third country.

(4) The third condition is that the authority has entered into arrangements with the Secretary of State in accordance with section 1253E.

1253DB    Transfer by statutory auditor with approval of Secretary of State

(1) A statutory auditor may transfer audit working papers to an approved third country competent authority if the transfer is made—

(a) with the prior approval of the Secretary of State, and

(b) in accordance with rules of a recognised supervisory body meeting the requirements of paragraph 16AA of Schedule 10.

(2) The Secretary of State must not approve a transfer of audit working papers to an approved third country competent authority for the purposes of this section unless the following conditions are met (see also section 1253DD).

(3) The first condition is that the authority has made a request to the Secretary of State for the transfer of the audit working papers.

(4) The second condition is that the audit working papers relate to audits of companies that—

(a) have issued securities in the third country in which the authority is established, or

(b) form part of a group issuing statutory consolidated accounts in that third country.

(5) The third condition is that the authority has entered into arrangements with the Secretary of State in accordance with section 1253E.

1253DC    Transfer by statutory auditor for purposes of investigation of auditor

A statutory auditor may transfer audit working papers to a third country competent authority if the transfer is made—

(a) for the purposes of an investigation of an auditor or audit firm, and

(b) in accordance with rules of a recognised supervisory body meeting the requirements of paragraph 16AB of Schedule 10.

1253DD    Agreement of EEA competent authority

(1) This section applies where—

(a) an approved third country competent authority makes a request to the Secretary of State for the transfer of audit working papers which relate to the audit of the consolidated accounts of a group, and

(b) the audit working papers that are the subject of the request—

(i) have been created by the auditor of a subsidiary that is located in another EEA State in relation to the audit of that subsidiary, and

(ii) are in the possession of a statutory auditor.

(2) In the case of a transfer by the Secretary of State under section 1253DA, the transfer must not take place unless the EEA competent authority responsible for the auditor of the subsidiary has given its express agreement to the transfer.

(3) In the case of a transfer by a statutory auditor under section 1253DB, the Secretary of State must not approve the transfer unless the EEA competent authority responsible for the auditor of the subsidiary has given its express agreement to the transfer.

1253DE    Transfer by means of inspection

(1) This section applies in the case of a transfer of audit working papers if—

(a) it is a transfer to an approved third country competent authority listed in section 1253D(2)(a), (f) or (g),

(b) it is a transfer under section 1253DA or 1253DB, and

(c) it is to take place by means of an inspection in the United Kingdom by the authority.

(2) The Secretary of State must participate in the inspection.

(3) The inspection must be under the leadership of the Secretary of State unless the Secretary of State otherwise permits.”

(1)

2006 c.46. Section 1253D was inserted by regulation 15 of S.I. 2007/3494.

(2)

1998 c.29.