Auditors and auditing companies
Client protection is ensured by monitoring the licensing requirement and compliance with the licensing conditions as well as by cooperating with the competent authorities such as the Office of the Public Prosecutor and the professional association. The FMA also regularly conducts quality assurance assessments and may file disciplinary charges with the Court of Appeal. The legal foundations are the Financial Market Authority Act (FMA Act) and the Auditors and Auditing Companies Act (AACA).
Monitoring of licensing requirement / Use of professional and business terms
Anyone intending to offer services under the Auditors and Auditing Companies Act in the Principality of Liechtenstein requires an FMA licence. The FMA monitors compliance with this licensing requirement and authorized use of the term “auditor” or equivalent professional or business term. It follows up on all indications of non-licensed auditor activities or the use of protected terms by non-licensed persons.
If there is a justified suspicion that a person is engaged in commercial auditor activities without authorization or is unlawfully using the term “auditor” or an equivalent professional or business term, the FMA initiates supervisory proceedings to determine the state of affairs. It may demand information and documents from the persons concerned as if they were supervised persons. If the suspicion is substantiated in the course of the preliminary clarifications, the FMA files criminal charges with the Liechtenstein Office of the Public Prosecut.
Monitoring of compliance with licensing conditions
After granting the licence, the FMA monitors permanent compliance with the licensing conditions. If there are grounds for suspicion that the licensing conditions are no longer met, the FMA initiates supervisory proceedings and seizes the necessary measures. If, for instance, it comes to the attention of the FMA that an auditor or auditing company no longer maintains the legally required liability insurance, then it demands that the licensed person provide evidence of such insurance. If the person fails to comply, the FMA suspends the person’s activities as an auditor until the evidence is provided.
The FMA may withdraw a licence if the licensing conditions are no longer met or if the licence-holder does not comply with the FMA’s demands to restore a lawful state of affairs. If the licence-holder fraudulently obtained the licence by providing false information, or if the FMA was unaware of essential facts, then the FMA may revoke the licence.
Quality assurance assessment
Through regular quality assurance assessments, the FMA ensures ongoing supervision in regard to audits of annual accounts. In particular, compliance with the relevant auditing standards and the independence requirements as well as the internal quality assurance system and ongoing training are reviewed.
Disciplinary offenses
The FMA is responsible for exercising disciplinary powers over auditors. The FMA initiates disciplinary proceedings for instance in the event of failure to comply with the auditing standards applicable to audits of annual accounts or with the applicable independence requirements.
Cooperation with competent authorities
To combat abuse, the FMA works closely together with the competent bodies (Office of the Public Prosecutor, courts, authorities and professional association). With the exception of national and international obligations to cooperate, the FMA in principle does not provide information about ongoing proceedings.
Institutions for the protection of clients
FMA: The FMA’s competence covers the points referred to above. In particular, it is not responsible for civil disputes between auditors and their clients.
Office of the Public Prosecutor: Notifies the FMA when criminal proceedings are initiated against an auditor in the case of a crime or misdemeanor (article 15(2) AACA)
Court of Justice: Punishment of infractions (article 46 AACA) and misdemeanors (article 47 AACA)