International Finance and Accounting Handbook

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Country

Reporting Requirement

EuropeFrance

The auditor must certify the financial statements or qualify the report following a standard format based on InternationalAuditing Standards. A second report is required, detailing agreements entered into between the company and legally definedrelated parties. There is no standard format for this second report.

Italy

The auditor’s report consists of four main paragraphs. The first identifies the financial statements and defines the responsibli-ties of both the Directors and the Auditors. The second (or scope) paragraph includes the source of accounting standards used,the parts of the director’s report necessary for a clear understanding of the responsibility. The third paragraph identifies anymaterial departure or deviation from generally accepted accounting standards. The fourth paragraph is the opinion paragraph.A fifth paragraph might be present for emphasis on significant matters.

The Netherlands

The wording is not specified by law. According to ISA 700 “The Auditors’ Report on Financial Statements” which has

been

adopted by NIvRA the auditors’ report includes among others both scope and opinion paragraphs. In the scope paragraphreference is made to the ISAs. In the opinion paragraph the auditor clearly states as to whether the financial statements give atrue and fair view in accordance with the financial reporting framework and, where appropriate, whether the financial state-ments comply with statutory requirements.

Sweden

Chapter 10 of the Companies Act states that the auditor’s report should include statements about1. The preparation of the annual report in accordance with the Act.2. The adoption of the balance sheet and income statement.3. The proposal included in the administration report for disposition of the unappropriated earnings or deficit.4. The discharge from the liability of members of the board of directors and the managing director.

United Kingdom

The auditor’s report sets out respective responsibilities of directors and auditor’s scope of audit; basis of opinion and state

ment

of opinion. By statute it must cover the balance sheet, profit and loss account, and related notes; by auditing standards it ex-tends to other financial statements prescribed by accounting standards, such as the cash flow statement. The opinion is statedon whether the financial statements give a true and fair view and comply with statutory requirements. The scope section ex-plains that auditors read other information contained in the audit report, including the corporate governance statement, andconsider the implications for their report if they become aware of inconsistencies. The scope section also explains the auditor

’s

responsibilities in relation to the directors’ report, the accounting records, information and explanations required, and rulesregarding the disclosure of directors’ remuneration.

Germany

According to the German Commercial Code the auditor’s report to the corporation must contain a description of the processand the result of the audit, including management’s report, an estimation of future development, a statement of compliancewith legal regulation and a statement explaining the company’s risk management system. The auditor must also provide asummary in the Bestaetigungsvmerk that covers the content, type, and volume of the audit; an evaluation of the audit results;and statements as to whether or not the financial statements and management’s report present a true and fair view.