New legislation has been introduced in Germany to require public company auditors to undergo rigorous peer review standards similar to their U.S. counterparts.
The move was made to raise the position of German accountants in the world financial marketplace. The legislation, which still needs to approved by the German Parliament, would be effective January 2001.
The requirement would initially be for only auditors of public companies, but eventually will trickle down to all auditors who will require the peer review to establish a measurement of quality in the profession.
"This law is a response to an internationalization of the profession that has resulted in tougher requirements on quality," said a spokeswoman for the German Ministry of Economics.
The peer reviews will be monitored by an independent committee of the German Chamber of Accountants, modeled similarly to the Public Oversight Board in the U.S.