In this chapter we examine the regulation of auditing in France and the initiatives to restore trust in auditing. First, we present a brief historical review of the regulation of auditing in France. Then we examine the following specific aspects of regulation: the institutions involved, licensing, professional liability, standards on auditing, ethics and independence, practice regulation, and audit committees.
While some form of auditing for companies had been present before 1860, the birth of auditing for companies in France was signaled by the Loi du 23 mai 1863, which created the Sociétés à Responsabilité Limitée (SARL). The 1863 Act and the subsequent Loi du 24 juillet 1867 regarding sociétés anonymes (SA) required the members of a SARL at the annual general meeting to designate one or more commissaires with the responsibility of preparing a report on the situation of the company, its balance sheet, and the accounts presented by the management.