Guidelines on the disclosure of fee-related information of external auditors
The Securities and Exchange Commission (SEC) issued Memorandum Circular no. 18 series of 2024, providing guidelines for applicable public interest entities which aim to enhance transparency regarding the independence of external auditors by aligning fee disclosure requirements with the Code of Ethics for Professional Accountants in the Philippines.
Companies covered
Public interest entities, including:
Disclosure requirements
Covered companies must disclose:
Exceptions
Under the second item above, the exception does not cover those PIE subsidiaries that are required to file financial statements under Part II of SRC Rule 68 or are in the process of filing their financial statements for the purpose of issuing any class of instruments in a public market or any PIE-controlled companies with non-controlling interest or minority shareholders.
Effectivity
The requirements under the Guidelines shall become effective for AFS ending December 31, 2024, and thereafter for applicable Companies. The two (2)-year comparative presentation shall be applicable in the initial year of implementation.
Visit the SEC website for more information. https://www.sec.gov.ph/mc-2024/sec-mc-no-18-series-of-2024-guidelines-on-the-disclosure-of-fee-related-information-of-external-auditors