New duties for audit committees

On 1 January 2025, the Act of 6 December 2024 amending the Accounting Act, the Act on Statutory Auditors, Audit Firms and Public Supervision and certain other acts (the “Amendment”) entered into force. The Act implements into the Polish legal order the new sustainability reporting obligations, according to the Common European Sustainability Reporting Standards (“ESRS”), introduced by Directive (EU) 2022/2464 of the European Parliament and of the Council of 14 December 2022 amending Regulation (EU) No 537/2014, Directive 2004/109/EC, Directive 2006/43/EC and Directive 2013/34/EU as regards corporate sustainability reporting (“CSRD”). The main objective of the CSRD is to ensure that more companies report relevant, comparable and reliable information on sustainability. This is necessary to achieve the objective of redirecting capital flows towards financing companies developing in a sustainable manner or pursuing such a transformation.

In particular, the provisions of the Accounting Act of 29 September 1994 and the Act on Statutory Auditors, Audit Firms and Public Supervision of 11 May 2017 were amended as part of the Amendment.

Following these legislative changes, audit committees, functioning in the structures of a public interest entity, were obliged to develop, in particular: a policy for the selection of the audit firm to perform the audit of financial statements and a policy for the selection of the audit firm to perform the attestation of sustainability reporting - in the case of a public interest entity obliged to prepare sustainability reporting or group sustainability reporting; and a policy for the provision by the audit firm performing the audit or attestation of sustainability reporting, by affiliates of the audit firm and by a member of the network to which the audit firm belongs of permitted services that are not audit or attestation of sustainability reporting.

The implementation of the provisions introduced under the Amendment requires an in-depth review of the internal documentation relating to the cooperation with the audit firm performing the audit or sustainability reporting attestation. In particular, the provisions of the procedure for the selection of an audit firm by a public interest entity, the statutory regulations (including the competence of the supervisory board on the appointment of the audit firm), the rules of procedure of the audit committee or the rules of procedure of the supervisory board (in connection with the statutory expansion of the catalogue of tasks of the audit committee) require revision.

If you need assistance with the implementation of the standards contained in the Amendment, I will be happy to assist you. I have significant experience in preparing documentation relating to the cooperation of a public interest entity with an audit firm.