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Is it a responsibility of auditor for reporting on non compliance with corporate governance or partial compliance and what are the consequences of this ,
Directors of listed companies are required to prepare a corporate governance report and this is published along with the financial statements in the company’s annual report.
Auditors do no audit this and their audit opinion refers solely to the Financial Statements (SOFP etc). However, under the Listing Rules auditors are required to review the part of the Corporate Governance Statement relating to the Company’s compliance with the
provisions of the UK Corporate Governance Code and mention their findings as part of their audit report, but not as part of their audit opinion.If there is non-compliance with the corporate governance rules then it would be a matter for the stock exchange – and pressure from shareholders.
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