Accountancy Profession Act (Cap. 281), article 2

2. (1) In this Act, unless the context otherwise requires - "accountant" means a warrant holder or an accountancy firm; "accountancy firm" means an entity, regardless of its legal form, formed in accordance with article 10 and any connected undertaking; "aptitude test" means a test limited to the professional knowle dge of the applicant, made by the Board with the aim of assessing t he ability of the applicant to pursue the profession of auditor in Malta; "audit" means the audit of historical financial statements and includes the statutory audit; the term "auditing" shall be cons trued accordingly; "audit client" means an entity in respect of which an auditor conducts an audit; Audit Directive" means Directive 2006/43/EC of the European Parliament and of the Council of 17 May 2006 on statutory audit s of annual accounts and consolidated accounts as amended by Directive 2014/56/EU of the European Parliament and of the Council of 16 April 2014; "Audit Regulation" means Regulation (EU) No. 537/2014 of the European Parliament and of the Council of 16 April 2014 or the specific requirements regarding statutory audit of public interest entities; "audit firm" means an entity, regardless of its legal form, whi ch is authorised to practise in the field of auditing in terms of article 10 and any connected undertaking; "auditor" is a holder of a practising certificate to practise i n the field of auditing and includes an audit firm; "approved accountancy body" means a local association of accountants for the time being recognized by the Board as an 2 CAP. 281.] ACCOUNTANCY PROFESSION approved accountancy body under article 9; "Board" means the Accountancy Board established by article 6; "CEAOB" means the Committee of European Auditing Oversight Bodies; "competent authority" means the authority designated by the law of Member States to be responsible for the regulation and, or oversight of statutory auditors and audit firms or of specific aspects thereof; "compliance principal" shall mean a principal of a firm, who, acting on behalf of and under the instructions of such firm, is responsible for ensuring compliance with the provisions of this Act or the regulations or directives issued under it, and in the ca se of a sole practitioner, shall, in all cases, be the sole practitione r; "connected undertaking" means an undertaking which is effectively managed or promoted as one practice with the firm o r as a related undertaking of the firm; "financial statements" means the individual accounts of an enti ty or the consolidated accounts of a group of entities; "firm" means, unless otherwise specified in a directive issued or regulation made under this Act, an audit firm or an accountancy firm; "generally accepted accounting principles and practice" means the generally accepted accounting principles and practice as defined in the regulations prescribed by the Minister in terms of article 8; S.L. 281.01 "home Member State" means a Member State in which an auditor or audit firm is approved in accordance with regulation 4(1) of the Accountancy Profession Regulations; "host Member State" means a Member State in which an auditor approved by his or her home Member State seeks also to be approved in another Member State, or a Member State in which an audit firm approved by its home Member State seeks to be registered or is registered in another Member State; Cap. 386. "medium-sized undertakings" mean s undertakings referred to in paragraph 1 of Part I of the Third Schedule of the Companies Ac t; "Member State" means a member state of the European Union; "Minister" means the Minister responsible for finance and, to the extent of any functions delegated to it by the Minister, includ es the Board; "network" means the larger structure which is: (a) aimed at cooperation and to which an auditor belongs; and (b) clearly aimed at profit- or cost-sharing or shares common ownership, control or management, common quality-control policies and procedures, a common business strategy, the use of a common brand-name or a significant part of professional resources; ACCOUNTANCY PROFESSION [CAP. 281. 3 "non-practitioner" means any natural person who, during his or her involvement in the governance of the Board and during the period of three years immediately preceding that involvement has not carried out statutory audits, has not held voting rights in an audit firm, has not been a member of the administrative or management body of an audit firm and has not been employed by, or otherwise associated with, an audit firm; "practising certificate" shall have the meaning assigned to it in article 4(2); "principal" means every member of the ad-ministrative or management body of a firm, and any individual who is authorised to sign a report on behalf of a firm; and in the case of an audit firm, shall include any individual responsible for leading the engagement: Provided that any individual carrying out the role of an engagement quality control reviewer on a statutory audit, and w ho is not authorised to sign a report on behalf of the firm in any capacity, is not deemed a principal: Provided further that a warrant holder or a holder of a practising certificate who acts as a sole practitioner, may not engage a principal to act on his behalf; "public-interest entity" means an entity governed by the law of a Member State whose transferable securities are admitted to trad ing on a regulated market of any Member State within the meaning of point 14 of Article 4(1) of Directive 2004/39/EC, a credit institution as defined in point 1 of Article 3(1) of Directive 2013/ 36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, other than those referred to in Article 2 of that Directive, an insurance undertaking within the meaning of Article 2(1) of Directive 91/674/EEC and such other entities as may be prescribed in regulations made by the Minister under this Act. References to the Directives in this definition shall include any other legis lation amending or substituting such Directives; Cap. 386. "small undertakings" means the companies referred to in article 185(1) of the Companies Act; "statutory audit" means an audit of annual financial statements or consolidated financial statements in so far as: (a) required by European Union law; (b) required by Maltese law as regards small undertakings;; "third-country" means a country which is not a Member State; "third-country audit entity" means an entity, regardless of its legal form, which carries out audits of entities incorporated i n a third country, other than an entity which is registered as an a udit firm in any Member State as a consequence of approval in accordance with Article 3 of the Audit Directive; "third-country auditor" means an individual who carries out 4 CAP. 281.] ACCOUNTANCY PROFESSION audits of an entity incorporated in a third country, other than an individual who is registered as a statutory auditor in any Memb er State as a consequence of approval in accordance with Article 3 and 44 of the Audit Directive; Cap. 490. "Tribunal" means the Administrative Review Tribunal established by article 5(1) of the Administrative Justice Act; "warrant holder" shall mean a person who holds a warrant issued in terms of article 4(1). (2) For the purposes of this Act references to a warrant issued thereunder includes references to a warrant deemed to have been so issued. (3) In this Act and in any regulations, directives or guidelines made thereunder, if there is any conflict between the English a nd Maltese texts, the English text shall prevail. Warrant required to practise the profession. Amended by: XIII. 1983.5; XXIV .1986.2; XVI. 1991.2; XIV . 2003.3; L.N. 423 of 2007; IX. 2008.48; XXIII. 2009.30; VIII. 2016.3; XXI of 2020.