The independence of external auditors is essential to the provision of an objective opinion on the truth and fairness of the financial statements. As such, the Audit Committee is mandated to ensure continuing objectivity and independence of the external auditor.
- Rotation policy of engagement partner
- HKEX has adopted a 5-year rotation policy regarding the engagement partner of its external auditor so as to strengthen the independence of auditor and to induce a fresh approach to the audit. The first rotation took effect from the audit for 2005. Any exception would require approval of the Audit Committee and the Board.
- Policy of hiring external auditor’s employees
- It is the Group’s policy not to hire employees of an external auditor who are or have been involved in the Group’s audit so as to ensure no impairment of the auditor’s judgement and independence with respect to an audit.
- Ex-employees of the Group’s external auditor joining the Group must be pre-approved by the Group Chief Financial Officer.
- Employees of external audit firms recruited by HKEX as staff in the Listing under Listing and Regulatory Affairs Division are subject to a desensitisation period of 6 months, during which they are not allowed to handle listing applications that their former audit firms have been involved in.