Introduction

Section 1548 of the Companies Act 2014, and Regulation (EU) No 537/2014 limit the tenure of a statutory auditor or audit firm of a public-interest entity (PIE) to 10 years. However, under exceptional circumstances, a PIE can request an extension to reappoint an audit firm for up to 2 more years.

Form and manner

Requests must follow IAASA’s specified format. Since circumstances vary by PIE, each application is assessed individually.

To request an extension, PIEs should send a letter from the Chair of the Audit Committee to IAASA (AQS@iaasa.ie) with the following details:

• The PIE’s category (i.e. listed on a regulated market, a credit institution or an insurance undertaking)
• The name of the statutory auditor or audit firm to be reappointed
• The original date of appointment of the audit firm and first period audited
• The exceptional circumstances for the extension request
• The requested extension period (up to 2 years) and reasons for it
• Any commercially sensitive information should be clearly indicated

The letter should be accompanied by a letter from the existing audit firm confirming:

• The applicant is a PIE as defined in Section 1461 of the Companies Act 2014
• The exceptional circumstances mentioned in the Chair’s letter exist at the time of the application

Additional guidance

Section 1548 of the Companies Act provides examples of “exceptional circumstances,” such as mergers, acquisitions, and special investigations. This list is not exhaustive, and PIEs should submit any circumstances they consider exceptional. Not all mergers, acquisitions, and special investigations will be deemed exceptional.

In extension requests, PIEs should explain how the circumstances will affect audit quality if the extension is not approved. IAASA encourages engagement in advance of the application, which can be arranged by requesting a meeting with the Head of Operations via AQS@iaasa.ie.

 In accordance with section 1548 of the Companies Act:

• If IAASA grants an extension, it will publish its decision on its website
• If it does not grant an extension, it will provide the reasons for not doing so