CSA adopts changes to auditor oversight rules

The Canadian Securities Administrators (CSA) have published final amendments that will help the Canadian Public Accountability Board — the country’s public company audit firm regulator — access audit work performed by foreign firms.

The firms in question, called significant component auditors, aren’t subject to the board’s oversight, but they complete a significant portion of the work for the audits of Canadian reporting issuers.

With the amendments, if a significant component auditor doesn’t voluntarily provide access to the public accountability board and the board wants to inspect the auditor’s work, the auditor must enter into an access agreement with the board or lose its auditing eligibility.

“Auditors play a central role in fostering confidence in our capital markets,” said Louis Morisset, CSA chair and president, and CEO of the Autorité des marchés financiers, in a release. “These new rules will improve audit quality through enhanced oversight, reducing the potential for errors in the audits of Canadian public companies.”

The amendments to National Instrument 52-108 Auditor Oversight and to its companion policy come into force on March 30 after ministerial approval.

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