CMVM May refocus supervision on public interest entity auditors
In a recent article published by Diário de Notícias, the President of the Portuguese Chartered Accountants Association (OROC) called for a reassessment of the oversight model currently adopted by the Portuguese Securities Market Commission (CMVM). His position stresses the need for more proportional and risk-based regulation, to avoid applying uniform requirements to audit firms with vastly different sizes and risk profiles.
The President emphasized that the current supervisory framework may be leading to imbalance: while large audit firms serving public interest entities require more intensive oversight, subjecting small or mid-sized firms to the same standards can become excessive and burdensome, especially for teams with limited resources.
Key points raised in the article:
- Supervision must be calibrated to the risk level and complexity of the audited entities;
- Overregulation may hinder the operational capacity of smaller firms;
- The current model could discourage new talent and firms from entering the profession;
- A well-calibrated regulatory system should balance quality assurance with sector sustainability.
This debate gains even more relevance in the broader context of increasing European regulatory demands, which have grown more technical and time-consuming, significantly affecting the daily work of statutory auditors.
Moreover, the discussion raises a key question: How can the profession uphold high-quality standards and public trust without creating barriers to entry or reducing diversity in the sector? An overly demanding regulatory framework could lead to the dominance of large firms, limiting competition and innovation in the market.
At Pontes, Baptista & Associados (PBA), we closely follow this ongoing regulatory debate. While we remain committed to high professional standards, we believe that a successful oversight model must also be flexible and fair, ensuring that audit firms of all sizes can operate confidently and compliantly, contributing to a robust and diverse audit ecosystem in Portugal.
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