# Regulation (EU) No 537/2014 of the European Parliament and of the Council of 16 April 2014 on specific requirements regarding statutory audit of public-interest entities and repealing Commission Decision 2005/909/EC (Text with EEA relevance), Article 5: Prohibition of the provision of non-audit services

Extent: E+W+S+N.I.

1. A statutory auditor ... carrying out the statutory audit of a public-interest entity, or any member of the network to which the statutory auditor ... belongs, shall not directly or indirectly provide to the audited person, to its parent undertaking (incorporated or formed in any part of the United Kingdom) or to its subsidiary undertakings... any prohibited non-audit services in:
(a) the period between the beginning of the financial year of the accounts to be audited and the issuing of the audit report; and
(b) the financial year immediately preceding that period in relation to the services listed in point (e) of the second subparagraph.
For the purposes of this Article, prohibited non-audit services shall mean:
(a) tax services relating to:
(i)preparation of tax forms;
(ii)payroll tax;
(iii)customs duties;
(iv)identification of public subsidies and tax incentives unless support from the statutory auditor ... in respect of such services is required by law;
(v)support regarding tax inspections by tax authorities unless support from the statutory auditor ... in respect of such inspections is required by law;
(vi)calculation of direct and indirect tax and deferred tax;
(vii)provision of tax advice;
(b) services that involve playing any part in the management or decision-making of the audited person;
(c) bookkeeping and preparing accounting records and accounts;
(d) payroll services;
(e) designing and implementing internal control or risk management procedures related to the preparation and/or control of financial information or designing and implementing financial information technology systems;
(f) valuation services, including valuations performed in connection with actuarial services or litigation support services;
(g) legal services, with respect to:
(i)the provision of general counsel;
(ii)negotiating on behalf of the audited person; and
(iii)acting in an advocacy role in the resolution of litigation;
(h) services related to the audited person's internal audit function;
(i) services linked to the financing, capital structure and allocation, and investment strategy of the audited person, except providing assurance services in relation to the accounts, such as the issuing of comfort letters in connection with prospectuses issued by the audited entity;
(j) promoting, dealing in, or underwriting shares in the audited person;
(k) human resources services, with respect to:
(i)management in a position to exert significant influence over the preparation of the accounting records or the accounts which are the subject of the statutory audit, where such services involve:
searching for or seeking out candidates for such position; or
undertaking reference checks of candidates for such positions;
(ii)structuring the organisation design; and
(iii)cost control.
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4. A statutory auditor ... carrying out statutory audits of public-interest entities and, where the statutory auditor ... belongs to a network, any member of such network, may provide to the audited person, to its parent undertaking (incorporated or formed in any part of the United Kingdom) or to its subsidiary undertakings non-audit services other than the prohibited non-audit services referred to in paragraphs 1 and 2 subject to the approval of the audit committee after it has properly assessed threats to independence and the safeguards applied in accordance with paragraph 8 of Schedule 1 to the Statutory Auditors and Third Country Auditors Regulations 2016. ...
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Source: https://www.legislation.gov.uk/eur/2014/537/article/5 (the official version)
Page: https://openlegislation.uk/eu-regulation-2014-537/article-5
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.