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Institut des Réviseurs d'Entreprises- Luxembourg

Member | Established: 1984 | Member since 1995

IRE was established by Law in 1984 and is a mandatory membership organization for auditors and audit firms. IRE attributions are: (i) to defend the rights and interests of the profession; (ii) to issue standards for the fields of activity other than statutory audits; (iii) to ensure respect for professional standards and duties, except for those applicable to statutory audits; (iv) to ensure respect by its members of their professional obligations arising from the legislation relating to the fight against money laundering and terrorist financing; (v) to forestall and conciliate any disputes, other than those related to statutory audits, between its members, on the one hand, and between its members and third parties, on the other hand; (vi) to perform certain duties entrusted to it by the Commission de Surveillance du Secteur Financier (CSSF); (vii) to make any proposals in the interest of the profession to the CSSF; (viii) to exercise disciplinary authority by its Disciplinary Board; and (ix) to publish the list of statutory auditors and audit firms. Apart from IFAC, IRE is also a member of Accountancy Europe. IRE actively participates in the work of the CNC, CSSF, CAA and various other authorities and local professional associations.

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Statements of Membership Obligation (SMO)

The Statements of Membership Obligations form the basis of the IFAC Member Compliance Program. They serve as a framework for credible and high-quality professional accountancy organizations focused on serving the public interest by adopting, or otherwise incorporating, and supporting implementation of international standards and maintaining adequate enforcement mechanisms to ensure the professional behavior of their individual members.

Last updated: 09/2023
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SMO Action Plan

Status of Fulfillment by SMO

  • SMO 1: Quality Assurance

    Institut des Réviseurs d’Entreprises (IRE)is involved in Commission de Surveillance du Secteur Financier (CSSF)’s committees and working groups where it provides technical guidance and promotes best practices to those responsible for the QA system and assists in its implementation. The CSSF’s QA system complies with the EU Audit Directive and is in line with SMO 1 requirements.

    Furthermore, as required by the Audit Law, IRE has implemented its own peer review system to ensure that its members respect their legal obligations and professional rules, other than those related to statutory audit, as well as their professional obligations arising from legislation relating to anti-money laundering and terrorism financing.

    The peer review system is risk-based. There is no fixed frequency for the reviews to adapt to changing environment and risks, but it does not go beyond 6 years. In case of unsatisfactory results, the statutory auditor and statutory audit firm may be subject to follow-up measures or to a disciplinary procedure which may give rise to disciplinary sanctions in accordance with the Audit Law. IRE has established an ongoing process to maintain its peer review system in compliance with SMO 1 requirements. In addition, IRE’s Education Committee delivers CPD programs to its members on relevant standards.

    Current Status: Sustain

  • SMO 2: International Education Standards

    The following laws and regulations organize the initial and continuing professional development (IPD and CPD, respectively) requirements for statutory auditors in Luxembourg: (i) the Audit Law, (ii) the grand-ducal regulation determining the requirements for the professional qualification of statutory auditors and approved statutory auditors and (iii) the Commission de Surveillance du Secteur Financier (CSSF) regulation organizing continuing education of statutory auditors and approved statutory auditors. CSSF is responsible for establishing CPD requirements. It also monitors the CPD requirements for approved statutory auditors while Institut des Réviseurs d’Entreprises (IRE) is responsible for monitoring the CPD requirements for statutory auditors.

    Statutory auditors are required by law and regulation to undertake at least 120 hours of CPD training over a period of 3 years (minimum 20 hours per year) with mandatory training in AML/FT matters. Approved statutory auditors are required by law and regulation to undertake at least 120 hours of CPD training over a period of 3 years (minimum 20 hours per year) with mandatory training in subjects as AML/FT, international accounting standards, audit, commercial law, tax, etc. IRE CPD activities are available on its website.

    The Audit Law and regulations requirements concerning IPD and CPD are compliant with the Audit Directive and the latest IES requirements. IRE uses its best endeavors to ensure the recent IES requirements are incorporated into national legislation and regulations.

    Through its membership with Accountancy Europe, IRE provides comments to any exposure drafts related to the IES.

    Current Status: Sustain

  • SMO 3: International Standards on Auditing

    According to the Audit Law, the application of ISA is required in all statutory audits and Commission de Surveillance du Secteur Financier (CSSF) may issue standards in the field of statutory audit for matters that are not covered by the auditing standards. Currently in force is the 2021 Handbook of International Quality Control, Auditing, Review, Other Assurance, and Related Services Pronouncements. The CSSF has published add-ons / carve-outs related to the ISA.

    Institut des Réviseurs d’Entreprises (IRE) is empowered to issue standards except for those applicable to statutory audit. It has therefore also adopted other applicable IAASB pronouncements such as ISAE, ISRE, and ISRS for auditors and audit firms. IRE has established an ongoing process to adopt new and revised relevant IAASB pronouncements. Pronouncements are adopted in the original English text with no add-ons/carve-outs. IRE monitors changes to ISA to provide advice to the CSSF and strives to ensure that regulation is regularly updated to comply with the most recent IAASB standards. IRE also indirectly contributes to the work of the European Group of Auditors Oversight Bodies through its technical assistance to the CSSF.

    To support implementation, IRE disseminates the currently applicable IAASB Handbook and offers technical support to both its members and the CSSF. It also provides its members with continuing professional development (CPD) on ISA and other IAASB pronouncements.

    Current Status: Sustain

  • SMO 4: Code of Ethics for Professional Accountants

    The Commission de Surveillance du Secteur Financier (CSSF) has adopted the IESBA Code of Ethics by way of CSSF Regulation. This regulation comprises add-ons/carve-outs to the IESBA Code, however there is an ongoing process within the CSSF to incorporate new and revised ethical requirements as issued by IESBA.

    Institut des Réviseurs d’Entreprises (IRE) promotes and supports implementation among its members. For example, it publishes latest version of the Handbook on its website for its members to access and includes trainings on new and revised ethical requirements in its annual continuing professional development (CPD) Program.

    Current Status: Sustain

  • SMO 5: International Public Sector Accounting Standards

    Public sector accounting standards are set by the Ministry of Finance (MoF) through regulations and circulars and Luxembourg is currently using a national cash accounting system. While Institut des Réviseurs d’Entreprises (IRE) has no responsibility for the adoption of public sector accounting standards, the institute reports it does promote and raise awareness of IPSAS. This includes involvement in the different technical committees of various government ministries including the Ministry of Finance. At a regional level, IRE also participates in Accountancy Europe initiatives.

    Current Status: Sustain

  • SMO 6: Investigation and Discipline

    The Audit Law empowers Commission de Surveillance du Secteur Financier (CSSF) to investigate and discipline approved statutory auditors and audit firms. In addition to the system maintained by the CSSF, the law also grants the IRE the power to operate an enforcement system for statutory auditors which includes investigative, disciplinary, and appeals processes. Both systems are compliant with the EU Audit Directive and SMO 6.

    Within the framework of Institut des Réviseurs d’Entreprises (IRE) responsibilities as conferred to by law, the IRE Disciplinary Board has the power to impose sanctions on any of its members including monetary fines, prohibition to exercise specific activities or permanent prohibition on the right to practice. Decisions of the Disciplinary Board may be challenged through appeal both by the member found guilty and by the General State Prosecutor. The appeal is then brought before the Civil Chamber of the Court of Appeal which will give its decision by way of a final judgment.

    IRE has established an ongoing process to keep its members informed of the disciplinary and administrative mechanisms via its annual report and website.

    Current Status: Sustain

  • SMO 7: International Financial Reporting Standards

    In accordance with the EU Accounting Directive, EU-endorsed IFRS are mandatory for the preparation of consolidated financial statements of listed entities. In addition, non-listed entities are permitted to apply EU endorsed IFRS for their consolidated financial statements. Upon authorization from the Luxembourg accounting advisory board (“CNC”), other non-listed entities have the choice between using EU endorsed IFRS or LuxGAAP for the preparation of their statutory financial statements.

    Institut des Réviseurs d’Entreprises (IRE) actively participates in the activities of CNC through its representatives in all CNC working committees. IRE provides advice to the CNC on the application of the EU and national accounting laws and regulations as well as the implementation of IFRS. IRE’s continuing professional development (CPD) offerings to its members include a full range of IFRS trainings. The CPD offering is available on IRE website.

    Current Status: Sustain


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