Appointment rules decide who chooses the auditor, when, and who may act. Shareholders usually elect the auditor, but timing differs: within 28 days of the accounts cycle in the UK, ideally before year end in Germany, and for a six-year term in France. Rotation rules bite mainly on public-interest entities and SEC registrants, with a 10-year firm limit and 7-year partner limit in the EU and a 5-year lead partner limit in the US.
Who appoints and when
A UK private company that needs an audit appoints an auditor for each financial year, usually by members' ordinary resolution within 28 days after the previous accounts are sent out; directors appoint the first auditor. In Germany the shareholders elect the auditor, ideally before the financial year ends, and the managing directors must issue the engagement immediately. In France the commissaire aux comptes is appointed for six financial years.
Not everyone can be appointed. German statutory audits must be performed by Wirtschaftsprüfer or audit firms, with vereidigte Buchprüfer also permitted for medium-sized GmbHs. In Saudi Arabia, tax losses can be carried forward only on accounts audited by a certified accountant licensed in the Kingdom, so an auditor licensed elsewhere does not meet that need.12345
Firm rotation for public-interest entities
In the EU an audit engagement of a public-interest entity may last no more than 10 years, which Member States may extend to 20 years after a public tender or 24 years with joint auditors. The UK has its own equivalent in section 494ZA: the engagement ends within 10 years of the last tender and in any case within 20 years.678
Partner rotation
Key audit partners on an EU public-interest entity audit must rotate off within seven years and stay away for three. For SEC registrants the lead partner and engagement quality reviewer may serve no more than five consecutive years, followed by a five-year time-out, and other audit partners seven years with a two-year time-out.910
| Market | Appointment | Firm limit | Partner limit | Source |
|---|---|---|---|---|
| United Kingdom | Members each year, within 28 days of accounts cycle | PIE: 10 years from last tender, 20 maximum | Not researched | CA 2006 ss485, 494ZA |
| Germany | Shareholders elect, ideally before year end | EU rule for PIEs (10 years) | EU rule for PIEs (7 years) | § 318 HGB; Reg. 537/2014 |
| France | General meeting; six-year mandate | EU rule for PIEs | EU rule for PIEs | Service Public F31440; Reg. 537/2014 |
| EU (PIEs) | National law | 10 years; 20 with tender or 24 joint (option) | 7 years, 3-year cooling-off | Regulation (EU) 537/2014 Art. 17 |
| United States (SEC registrants) | Audit committee practice not researched | No firm limit researched | Lead and EQR 5 years plus 5 off; others 7 plus 2 | Regulation S-X Rule 2-01(c)(6) |
Decisions to make
- Is any group entity a public-interest entity or an SEC registrant?6810Firm and partner rotation rules apply mainly to these entities and must be planned years ahead.
- Will the group use one audit network everywhere?45Each country restricts who may be appointed, for example German Wirtschaftsprüfer and Saudi licensed accountants.
- Has the appointment been made within the statutory window?12UK appointments fall within a 28-day period and German elections should happen before year end.
- When was the last tender for each public-interest entity?78The EU and UK maximum periods run from the start of the engagement or the last tender.
Documents usually needed
- Shareholder or members' resolution appointing the auditor
- Audit engagement letter
- Auditor's professional register extract or licence
- Audit tender and rotation schedule for public-interest entities
- Partner rotation log maintained by the audit firm
Common mistakes
- Letting the German shareholder election slip past year end
- Using an auditor who is not licensed locally where tax relief depends on audited accounts
- Assuming the 10-year EU limit applies to every subsidiary rather than to public-interest entities
- Forgetting that French mandates run for six financial years
- Not tracking partner tenure across group entities that are SEC registrants
Questions businesses ask
How long can the same firm audit an EU listed company?
Up to 10 years, extendable by Member States to 20 years after a public tender or 24 years with joint auditors.67
Who appoints the auditor of a German GmbH?
The shareholders elect the auditor, ideally before the end of the financial year, and the managing directors then issue the engagement.2
How often must the lead partner change on a US-listed audit?
After five consecutive years, followed by a five-year time-out.10
What this guide does not yet confirm
These points need checking with a qualified local professional before you rely on them.
- India: auditor appointment for five-year terms and the rotation rules under section 139 of the Companies Act 2013 could not yet be checked.
- Whether Germany and France use the Article 17(4) extension options was not confirmed in national law.
- Singapore auditor appointment and SGX partner rotation rules were not researched.
- UAE and Saudi company law appointment and rotation rules were not confirmed.
- UK partner rotation rules (FRC Ethical Standard) could not yet be checked.
Sources and review status
Each statement is numbered to the source it was checked against. We use official sources where we can, and each statement says whether it was checked against an official or a secondary source. Sources last checked on 19 October 2026. None of it has been professionally reviewed yet: it is research checked against official and secondary sources by WONE Global, not legal or tax advice.
A UK private company that needs an audit must appoint an auditor for each financial year, normally by ordinary resolution of the members within 28 days after the previous year's accounts are sent out or due to be sent out; the directors may appoint the first auditor and fill a casual vacancy. Companies Act 2006. Directors may decide not to appoint where they reasonably conclude audited accounts are unlikely to be required.
In Germany the shareholders elect the auditor, ideally before the end of the financial year to be audited, and the legal representatives (or the supervisory board where responsible) must issue the audit engagement immediately after the election. Statutory audits under § 316 HGB. Agreements restricting the choice of auditor to particular categories or lists are void (§ 318 Abs. 1a).
A company must appoint a statutory auditor (commissaire aux comptes) when it exceeds two of three thresholds: total balance sheet of 5 million euros, turnover excluding VAT of 10 million euros, or 50 employees. Applies to SARL, EURL, SA, SAS, SCA, SNC and SCS. Lower thresholds (2.5 million / 5 million / 25 employees) apply to parent entities of small groups. Mandate lasts six financial years.
German statutory auditors must be Wirtschaftsprüfer or Wirtschaftsprüfungsgesellschaften; for medium-sized GmbHs, vereidigte Buchprüfer and Buchprüfungsgesellschaften may also act. Auditors must hold an extract from the professional register under the Wirtschaftsprüferordnung; first-time statutory auditors have six weeks after accepting the engagement to obtain it.
In Saudi Arabia tax losses may be carried forward only if they were determined under statutory accounts audited by a certified accountant licensed in the Kingdom. Income tax payers; relevant to foreign-owned companies that are exempt from appointing an auditor under company law.
The ZATCA-hosted Implementing Regulations file is largely in Arabic.
In the EU an audit engagement of a public-interest entity with the same auditor or audit firm, including renewals, may not exceed 10 years. Public-interest entities (listed companies, banks, insurers and others designated by Member States). The initial engagement must be at least one year.
EU Member States may extend the maximum audit engagement of a public-interest entity to 20 years where a public tender is held, or to 24 years where more than one auditor is engaged as joint auditors. Member State option; whether Germany, France or another Member State uses it must be checked in national law.
Under UK law the maximum engagement period for an auditor subject to the rotation rules ends with the last financial year beginning within 10 years of the last qualifying selection procedure (tender), and in any case within 20 years of the start of the engagement. Section 494ZA applies to public interest entity audits; an extension of up to two years needs the competent authority's approval in exceptional circumstances.
Key audit partners on an EU public-interest entity audit must stop participating no later than seven years after appointment and may not return to that audit for three years. Public-interest entities.
An accountant auditing an SEC registrant is not independent if the lead partner or engagement quality reviewer has served in that role for more than five consecutive years, followed by a five-year time-out; other audit partners are limited to seven years with a two-year time-out. Federal, SEC Regulation S-X. Firms with fewer than five issuer audit clients and fewer than ten partners are exempt if the PCAOB reviews each engagement at least once every three years.
Regulatory text read on the Cornell Legal Information Institute reproduction of the Code of Federal Regulations; the eCFR at ecfr.gov is the government publication.
Questions on this topic
10 statements on auditor appointment and rotation
