Wirtschaftsprüferkammer

Under the Wirtschaftsprüferordnung (Public Accountant Act (WPO)) 1961 and its amendments the Wirtschaftsprüferkammer (Chamber of Public Accountants – WPK) is responsible for the quality assurance (QA) reviews of audits of non-public interest entities (PIEs) subject to the oversight of the Abschlussprüferaufsichtsstelle (APAS—Auditor Oversight Body (AOB)) and the Federal Ministry for Economic Affairs and Climate Action. Effective June 2016, QA reviews of the audits of PIEs are undertaken by the AOB which was established as a result of the EU Audit Reform and transposed into national law by the Abschlussprüferaufsichtsreformgesetz (APAReG; Auditor Oversight Reform Act) and amending the WPO. The WPK states that its QA procedures are in line with the requirements of SMO 1 and based on information from the AOB’s IFIAR profile, as well as from the WPK, it appears its system also meets SMO 1 requirements.

To carry out its QA function, the WPK has established a Commission on Quality Assurance, which is responsible for: determining the cycle of QA reviews based on a risk analysis; evaluating the capabilities and independence of the QA reviewers; evaluating QA review reports; and deciding on appropriate measures to remedy deficiencies found through the inspections. The Commission issues annual reports on its activities dating back to 2001. While the QA reviews are risk-based, the WPK reports that QA reviews are done at least every six years. Enhancements to the QA review procedures include the ability to initiate disciplinary proceedings based on the identified deficiencies in the QA review results.

To support the effective implementation of the QA review system, the WPK offers its members several means of technical guidance and support. For example, the chamber answers frequently asked questions related to QA reviews, publishes examples of common deficiencies found during QA reviews, and holds continuing professional education for both auditors and QA examiners, including the application of ISQM 1, ISQM 2 and ISA 220 (rev.). The chamber reports that it held eight training sessions throughout 2022 for members and QA reviewers and additional training planned throughout 2023. The Commission also intends to host a knowledge-sharing session for senior QA reviewers.

The chamber states that it also makes annual presentations to members regarding any changes to the QA review system and will periodically publish decisions that lead to sanctions and legal proceedings along with explanatory articles in the WPK’s member journal.

Current Status: Sustain

The Wirtschaftsprüferordnung (Public Accountant Act (WPO)) 1961 sets forth different routes for admission to the Wirtschaftsprüfer profession. Overall, the IDW and WPK jointly state that the accountancy educational requirements in Germany meet the IES requirements.

Before receiving the designation of Wirtschaftsprüfer, individuals must complete a university degree. Candidates must then complete a minimum of three years’ practical experience, with at least two years being in audit practice. Subsequently, candidates may sit for examinations (content: see § 4 of the Wirtschaftsprüfer Examination Regulation and the Referenzrahmen [reference framework]). After passing the examinations (four modules in six years maximum) applicants are appointed as Wirtschaftsprüfer whereupon they receive a certificate issued by the Wirtschaftsprüferkammer (Chamber of Public Accountants – WPK). The WPO and the Wirtschaftsprüfer Examination Regulation (WiPrPrüfV) regulate the specifics of the practical experience and the content of the examinations.

The WPK has been responsible for carrying out the examination procedures since 2004 and has established an Examination Unit to carry out this work nationwide. The exam consists of four modules. Each module consists of a written and oral component and the papers in the written section are selected by a Task Commission, comprised of a representative of a federal state, the head of the WPK’s Examination Unit, and representatives from the profession, academia, the business world, fiscal administration and lawyers. The chamber provides further information in a dedicated guide. Moreover, the WPK offers several other supplementary materials to support candidates toward earning their qualification. The chamber maintains a list of initial professional development training providers and study programs, an internship database, and a summary of exam topics from previous years.

In addition, the WPK also coordinates the procedures for an Aptitude Test for statutory auditors approved in a member state of the European Union (EU) or the European Economic Area (EEA) or in Switzerland.

Furthermore, the WPK stipulates continuing professional development requirements (CPD) within its bylaws for its members, which are a minimum of 40 CPD hours per year. The chamber offers its own training events each year to help members meet their obligations and also lists other training from approved providers on its website.

Finally, both the IDW and WPK are part of the Professional Accountancy Education Europe (PAEE; formerly Common Content Project) which is designed to harmonize the professional qualifications and education and training outcomes for auditors across Europe.

Current Status: Sustain

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The Wirtschaftsprüferordnung (Public Accountant Act (WPO)) 1961 and the German Commercial Code (Handelsgesetzbuch) establish ethical requirements for the Wirtschaftsprüfer profession. Both laws form the legal basis on which the Wirtschaftsprüferkammer (Chamber of Public Accountants – WPK) is legally authorized to develop ethical requirements in more detail in the form of by-laws for the profession (WPK’s Professional Charter). The WPK states it has an ongoing process to eliminate differences and address new developments between its ethical requirements and the IESBA Code of Ethics. In 2021, the German requirements reached convergence with the 2020 version of the International Code of Ethics (in combination with the EU Audit Regulation). The WPK indicates that it expects its requirements to be fully converged with the 2022 version of the International Code of Ethics by end of 2024 (in combination with the EU Audit Regulation) – by addressing the remaining revisions related to PIEs/Listed Entity.

The WPK reports that it proactively raises awareness around the IESBA Code of Ethics by publishing annotations on terms and concepts on the ethical requirements within the WPK’s Professional Charter (bylaws) and pronouncements and revisions to the IESBA Code are disseminated amongst members. The chamber is an active participant in the IESBA’s meetings and the standard-setting process, having jointly nominated an IESBA member with the IDW and having its Senior Manager in its Audit & Accounting Division serve as Technical Advisor. The WPK also notes that it will submit comments to IESBA-issued exposure drafts. Meanwhile at the national level, the WPK reports that it engages in dialogue with several Ministries, such as the Federal Ministry for Economic Affairs and Climate Action and the Federal Ministry of Justice to communicate the importance and spirit of the Code of Ethics and adding the technical expertise of the profession to legislative processes.

In supporting the application of ethical standards amongst its members, the chamber offers a variety of technical support. For example, the chamber will respond to members’ oral and written inquiries on technical matters in relation to ethics (including a telephone service); produce case studies and explanatory materials regarding specific issues of ethical and professional conduct and publish these in its member journal; translate the IESBA Code of Ethics into German; and hold annual seminars to discuss professional duties and conduct.

The WPK further outlines specific implementation support in its SMO Action Plan such as, raising awareness on the NOCLAR standard; making translations of the IESBA Code available in German; and organizing outreach engagements with the IESBA Chair and IESBA staff and key stakeholders in Germany such as the Federal Ministry for Economic Affairs and Climate Action, Federal Ministry of Justice, Auditor Oversight Body, Accounting Standards Committee of Germany and Institut der Wirtschaftsprüfer.

Current Status: Sustain

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Under the Wirtschaftsprüferordnung (Public Accountant Act (WPO)) 1961 and its amendments the Wirtschaftsprüferkammer (Chamber of Public Accountants – WPK) is responsible for the investigation and discipline (I&D) of the Wirtschaftsprüfer profession subject to the oversight of the Abschlussprüferaufsichtsstelle (APAS—Auditor Oversight Body (AOB)) and the Federal Ministry for Economic Affairs and Climate Action. The WPK is responsible for investigating and disciplining all violations, i.e., criminal activity, intentional or severe breaches of professional duties and acts likely to bring the audit profession into considerable disrepute; however, breaches of professional duties during statutory audits of public interest entities are within the scope of the AOB’s responsibilities. WPK states it has reviewed the SMO 6 benchmark and concluded that its procedures address the SMO 6 requirements.

To carry out its mandated I&D functions, the WPK maintains a Disciplinary Oversight Department which encompasses the following areas: revocation proceedings; financial statement reviews; and disciplinary proceedings. Further details of the Disciplinary Oversight is outlined on the WPK’s website and within the WPO.

The WPK publishes an annual report on its disciplinary oversight cases and sanctions (in German) dating back to 2001. Sanctioning measures which have become final are published for a duration of 5 years either on the website of WPK or APAS, depending on which authority has imposed the sanctions in question. The publication regularly includes the name of the auditor, or the audit firm being sanctioned unless this would be disproportionate under the circumstances. The WPK’s quarterly magazine will also include relevant court decisions, practical cases, and other information for professionals related to compliance with standards.

With the implementation of the EU Audit Reform in June 2016, WPK’s I&D procedures have been enhanced to further link unsatisfactory quality assurance reviews with the I&D system and disciplinary proceedings may now be initiated based on the findings of quality assurance reviews.

Current Status: Sustain

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