Michael Ahern (Cork East, Fianna Fail)

I will deal first with amendment No. 45. Recommendation 14.1 of the report of the review group on auditing recommended that not only should the director's compliance statement cover obligations under company law and taxation law, it should also cover other relevant statutory or regulatory requirements. In translating this recommendation into law, section 43(1)(c) – in the definition of relevant obligations – provides for compliance with any other enactments that provide a legal framework within which the company operates, and that may materially affect its financial statements.

As outlined in the review group reports leading up to that recommendation, directors are already required to prepare accounts that give a true and fair view and auditors, when undertaking audits, have to have regard to Statement of Auditing Standard No. 120 "Consideration of Law and Regulations"– SAS 120 – which places obligations on auditors to obtain sufficient appropriate audit evidence about compliance with those laws and regulations that relate to the preparation inclusion or disclosure of specific items in financial statements. The commentary contained in SAS 120 requires that auditors remain alert for instances of actual non-compliance with other law and regulations which might affect the financial statements. In the circumstances, while I have listened to the arguments made by Senator Coghlan and others, I do not consider that they outweigh the other considerations involved.