Special audits

Special audit - verification of company formation procedures and management of individual transactions

Company Assembly or the court may appoint a special auditor to examine the processes of company formation or the management of individual transactions of the company, including increases or decreases of capital share in the last five years. So which functions are usually the subject of such a specific audit? In most cases, the audit is of acts associated with the company business – its operation and management – while the verification of management procedures may require review of formation procedures and of activities associated with capital increases. For a special audit, it is most important that the Assembly clearly and unequivocally states the subject of the review.

The special auditor must prepare a written report of their findings and submit it to the management (and the court, if one is specified). The auditor reports only the facts identified, and doesn´t express any opinion. Further action is the responsibility of the management, who submits the report to the Supervisory Board and puts it on the agenda of the next meeting.

Special audit - checking business relationships with the parent company or a related company

According to ZGD-1, which was adopted in 2015, a court can appoint a special auditor at the request of any shareholder, for the purpose of verifying the company's business relationships with the parent company or a related company if:

  • the auditor’s report has reserved decision, or given a negative decision, about relationships with a related company and the statement was rejected by the auditor
  • the Supervisory Board’s management statement at the end of the report includes comments about relations with related companies
  • management have said that the company was deprived of certain legal transactions, or other opportunities, without any replacement