CONSOB issues guidance on auditing rules

Silvio Riolo, Clifford Chance, Rome

CONSOB has issued a guidance clarifying that a company which has appointed the same firm to audit its accounts for three consecutive periods of three years (three years is the maximum extent of a mandate of an auditing company), may not appoint that firm for another three-year period until there has been a gap of three years from the conclusion of the last mandate. In the case of a spin-off of the auditing business of an auditing firm, involving the transfer of the auditing business into a new company, the new company shall assume all relationships with audited companies as they are, so that the new company is prevented from continuing to carry out the outstanding mandates where such continuation is in conflict with the three year rule.