(This note is not part of the Order)

This Order amends the law relating to statutory auditors as defined in section 1210 of the Companies Act 2006 ("the 2006 Act"). It extends to the whole of the United Kingdom.

Part 2 of the Order (articles 4 and 5) amends the 2006 Act. It re-implements obligations in Directive 2006/43/EC of the European Parliament and of the Council of 17 May 2006 on statutory audits of annual accounts and consolidated accounts (OJ L 157, 9.6.2006, p.87), and makes provision for matters which arise out of or relate to these obligations.

Article 4 substitutes new sections 1225 to 1225G for the existing section 1225 in Part 42 of the 2006 Act. They provide for additional types of action which may be taken against a statutory auditor's professional body (in connection with securing the body's responsibilities properly to supervise its statutory auditor members). The Secretary of State may now give a direction to a professional body (e.g. directing the body to do specified things) and may now impose a financial penalty upon such a body.