- any function in respect of a company incorporated in the United Kingdom or Ireland which is required to be performed by a Registered Auditor as auditor of that company;
- any function in respect of any of the following entities constituted in the United Kingdom or Ireland which is required to be performed by a Registered Auditor as auditor of that entity:
- a building society;
- a credit union;
- a charity;
- an industrial and provident society;
- a friendly society;
- a pension scheme;
- a limited liability partnership;
- a partnership;
- an open ended investment company;
- a unit trust;
- a Lloyds' syndicate;
- a mutual life office; and
- a person authorised under legislation relating to the conduct of investment, insurance or mortgage business;
where such function is expressly required to be discharged either by or under United Kingdom or Ireland legislation.
- any function in respect of a United Kingdom traded non-EEA company which is required to be performed by an auditor and which is performed by a Registered Auditor as auditor of that company.
- any function in respect of a company incorporated in the United Kingdom or the Ireland which is included on the official list which is performed by a Registered Auditor following appointment as auditor of that company in relation to its financial statements or extracts of financial statements as required by a listing authority or a recognised company stock exchange in either of those jurisdictions.
Guidance: The reference above to an 'official list' is to the official list as defined in the Financial Services and Markets Act 2000, Part 6 or to the official list of the Irish Stock Exchange in Ireland. It therefore does not include companies whose shares are publicly traded but that are not included in the official list.
The reference above to a 'listing authority' is to the Financial Services Authority in the UK and the Central Bank in Ireland.
The reference above to a partnership is to a partnership where all the partners are companies or Scottish partnerships and in the latter case, each partner in the partnership is a limited company.
The reference to a United Kingdom traded non-EEA company means a body corporate;
- which is incorporated or formed under the law of a third country (other than Jersey, Guernsey and the Isle of man) that is not an EEA member state;
- whose transferable securities (equity or debt) are admitted to trading on a regulated market situated or operating on the United Kingdom (eg, the London Stock Exchange); and
- which has not been excluded (either as an individual company or class of companies or by country) by an order made under the 2006 Act, or by a direction or decision of the oversight body
Companies incorporated in Jersey, Guernsey and the Isle of Man have already been excluded, so this definition does not apply to them. The latest list of excluded companies can be viewed at www.frc-pob.org.uk.
Should a registered auditor consider that there is a conflict between the requirements of these regulations (as applied to a particular UK traded non-EEA company) and the non-EEA country law, then the firm should consider seeking a dispensation under audit regulation 2.17 from the Registration Committee.
Part a(iii) of the definition applies in respect of audits of accounting periods starting on or after 1 October 2010.
The definition does not extend to reports relating to entities other than those specified.
The definition only embraces those circumstances where a report is required to be provided by a registered auditor in respect of any of the entities specified and the requirement is express and emanates from legislation (whether primary or secondary) or the rules of a recognised stock exchange (in connection with a company admitted to the official list). The definition does not encompass situations where a report is required by a registered auditor but where the firm does not have to be appointed as auditor to the entity (for example, a report about non-cash consideration under section 593 of the Companies Act 2006).
The report must be required by legislation that is applicable solely to one of the entities listed above. Reports commissioned, for example by a grant making organisation, where the grant could have been made to any person, to ensure that beneficiaries of funds have used them appropriately would not fall within the definition (even where the requirement for the body to commission such a report itself emanates from statute).
Persons authorised under legislation relating to the conduct of investment, insurance or mortgage business are those who can undertake investment advice etc. In the UK these would be entities with permission under Part IV of the Financial Services and Markets Act 2000 (or regulations made under that Act) or equivalent legislation in Ireland.
This definition of 'audit' does not include an independent examination for charities. Nor does it include any report required as part of a public offer of securities (prospectus) required by investment business legislation or any report on a circular to shareholders, required by a stock exchange, to authorise a transaction.