Role of the auditor towards the works council

A company that employs more than 100 persons (to be computed based on a specific formulae) needs to have a works council, composed of representatives of the employer and of the employees and workers. These representatives of the employees and workers are chosen in elections that take place every 4 years. The functioning of the works council is defined by internal rules.

The statutory auditor cannot be (re)appointed without the pre-approval of the works council. The works council votes by simple majority, but this majority must be obtained in both delegations (i.e. employers’ and employees’).

Report on financial statements

It is the statutory auditor's obligation to issue a report, in writing, on the statutory annual accounts and the report of the board of directors similar to the statutory audit report.

Report on the economic and financial information

The statutory auditor must attest in a specific written report on the completeness and the fair of view of the economic and financial information that management provides to the works council, as far as this information derives from the books and the annual accounts of the company or other verifiable sources.

Explanation and analysis of the economic and financial information

To explain and analyse, especially to the members appointed by the employees or workers, the meaning of the economic and financial information in relation to the financial structure and the evolution of the financial situation of the entity. This can be done orally or through specific notes.

Statutory auditor's unability to report

If the statutory auditor believes he is not able to give an opinion on the completeness and the fair of view of the financial information, he must inform the board of directors of these findings. If the board of directors does not react within a month after this notification, the auditor must inform the works council on his own initiative.

Availability of financial information

It is management’s role to give financial information to the works council. The auditor must respect professional secrecy and cannot substitute for management in its role of delivering the economic and financial information.

The role of the auditor is to help the members of the works council understand and interpret the information provided by management (ratio analysis, (consolidated) financial statements, benchmarks, budget, etc.).

Auditor's attendance at works councils / meetings

The auditor must attend the works council each time he is invited by its members. In these meetings, he will answer all questions that are raised by the members, as far as they relate to matters under his responsibility.

The auditor can be invited to a preparatory meeting with the representatives from employees and workers. The statutory auditor can accept this invitation and informs the president and secretary of the works council of his/her intention.

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