Consultation on Draft IDW auditing standard on formal audit of disclosures on women's quota

The draft of the IDW EPS 351 Auditing Standards regulates the requirements that the auditor must observe when formally auditing the disclosures on the women's quota. These disclosures are part of the corporate governance statement which is included in the audit of the financial statements. Certain co-determined limited liability companies (GmbHs) are subject to the women's quota. We are critical of the fact that the IDW uses the desired or target state as a benchmark when interpreting whether a GmbH is subject to co-determination. The prevailing opinion in the literature assumes that a GmbH is only co-determined if it actually has a supervisory board. This needs to be changed. Furthermore, the auditors should not apply the standard draft of EPS 351, as exempted by the IDW, but only the final version.