ESAs advise against extending DORA to statutory auditors and audit firms

The European Supervisory Authorities (comprising the European Banking Authority, European Insurance and Occupational Pensions Authority and European Securities and Markets Authority) have published a joint report, dated 4 December, responding to the European Commission's request under Article 58(3) of the EU Digital Operational Resilience Act (DORA). The report assesses whether statutory auditors and audit firms should be subject to strengthened digital operational resilience requirements by means of inclusion in the scope of DORA or by means of amendments to the Statutory Audit Directive. While acknowledging the critical role that auditors play in financial stability and the fact that confidentiality, integrity and availability of information accessed during audits is critical, the report clarifies that audit activities do not form part of the operational value chain of the auditee and therefore do not directly affect the continuity of financial or other services. The ESAs conclude that the identified negative implications of the application of DORA to statutory auditors and audit firms such as increased fixed costs, limiting audit choice, increased audit fees and significant re-skilling of national audit oversight authorities, appear to outweigh the potential benefits. Therefore, including statutory auditors and audit firms within DORA's scope is not warranted at this stage.

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