Prudential Regulation Authority Rulebook

4.1

2.2 (6) shall not apply until the commencement of a firm’s financial year beginning on or after 17 June 2018 provided that a majority of the members, including the chair, of the audit committee of a significant firm are independent of the firm.

4.2

Subject to 4.3, a firm that is not significant or is a subsidiary undertaking of a non-EEA parent undertaking may not have an audit committee until the commencement of a firm’s financial year beginning on or after 17 June 2018 if its governing body is performing equivalent functions to an audit committee. In such a case 2.2 (1), 2.2 (2), 2.2 (5), 2.2 (6) and 2.2 (7) shall not apply, and the firm must disclose that the governing body carries out the audit committee’s functions and how its governing body is composed.

4.3

Until the commencement of a firm’s financial year beginning on or after 17 June 2018, where all members of the audit committee are members of the governing body of a firm that is not significant or is a subsidiary undertaking of a non-EEA parent undertaking, the audit committee is to be exempt from the independence requirements laid down in 2.2 (5), 2.2 (6) and 2.2 (7).

4.4

Chapter 2 shall not apply to a significant firm which is a subsidiary undertaking of an EEA parent undertaking until the commencement of a firm’s financial year beginning on or after 17 June 2018, where the parent undertaking complies at group level with Chapter 2 or with requirements implementing Article 39 of the Statutory Audit Directive in any other EEA State and, where applicable, with Articles 11(1), 11(2) and 16(5) of the Statutory Audit Regulation.