The European Parliament’s lead MEP on new legislation to reform the audit sector today hailed a breakthrough in negotiations which should see a deal finalised when representatives of member states meet in Brussels tomorrow (Wednesday).

The European Parliament’s lead MEP on new legislation to reform the audit sector today hailed a breakthrough in negotiations which should see a deal finalised when representatives of member states meet in Brussels tomorrow (Wednesday).

British Conservative MEP Sajjad Karim spoke out after an outline agreement was reached in three-way- talks (or trilogue) this morning between the Parliament and the EU’s Commission and Council.

The breakthrough came when trilogue resumed this morning after failing to reach a compromise last night. It comes after months of sometimes fraught negotiation, including a decision by Mr Karim earlier this month to cancel scheduled negotiations because of a lack of will by some parties to compromise.

Mr Karim said: “This week’s trilogue on the audit reform package has been truly encouraging with constructive efforts from all sides to find a way forward.

“The key objective of the European Parliament to improve audit quality and audit reporting was secured in the proposed package and the strong involvement of the audit committee throughout the process, in particular for non-audit services was guaranteed.

“On the controversial issue of rotation a 20-year timespan was agreed, which is a workable compromise and a considerable improvement on the Commission’s original proposal.”

“The European Parliament is optimistic that the proposal can be approved by a majority of Member States and MEPs, considering it is a balanced compromise that will go a long way towards restoring confidence in the audit market”.