Audit in New Zealand vs France: Key Differences
Understanding the differences in audit requirements is essential for any multinational business seeking compliance, transparency, and investor confidence. In this blog we compare the auditing requirements in New Zealand and France. Regulatory Bodies and Audit Frameworks Both France and New Zealand have well-established regulatory systems that ensure the integrity and transparency of financial reporting. Company Audit in France In France, the audit profession is regulated by the Haut Conseil du Commissariat aux Comptes (H3C), which ensures the quality and independence of auditors. Audits are performed in accordance with the Normes d’Exercice Professionnel (NEP), developed under the authority of the H3C. As France operates under a civil law system, audit obligations and professional standards are clearly defined and codified in legislation. Company Audit in New Zealand In New Zealand, the Financial Markets Authority (FMA) oversees the audit profession and enforces compliance with national auditing requirements. Auditors follow the New Zealand Auditing and Assurance Standards (NZ ASAs), which are aligned with the International Standards on Auditing (ISA) and issued by the External Reporting Board (XRB). Unlike France, New Zealand operates under a common law system, which places strong emphasis on principles-based regulation, professional judgement, and transparent corporate governance practices. Despite these differences, both frameworks aim to promote transparency, reliability, and trust in financial information. Auditing Process In both France and New Zealand, the purpose of auditing is the same: to verify the accuracy of financial statements, ensure transparency, and strengthen confidence in a company’s financial reporting. This means that auditors in both countries focus on confirming that the financial statements present a true and fair view of the company’s financial position in accordance with the respective national auditing standards. Throughout the audit process, they are also required to remain fully independent and objective to maintain the integrity of their opinion. Both jurisdictions also require auditors to report any irregularities they identify during their work, although the approach differs. In France, auditors have a formal procédure d’alerte (alert procedure), which obliges them to inform the company’s management and, if necessary, the commercial court when they detect irregularities that could threaten the company’s going concern. In New Zealand, there is no structured alert procedure equivalent to France’s system. Instead, auditors must comply with statutory reporting obligations under the Financial Markets Conduct Act 2013 and related regulations. This includes reporting serious wrongdoing, breaches of financial reporting requirements, and concerns about auditor independence to the appropriate authorities such as the Financial Markets Authority (FMA) or, in some cases, the company’s shareholders. Additionally, French auditors play a broader role beyond the annual audit of financial statements. They may be appointed to perform specific assignments such as verifying the value of contributions during mergers, transformations, or capital increases. Statutory Audit Requirements Thresholds Criteria France New Zealand Audit Requirement Trigger Mandatory if company exceeds 2 of 3 thresholds: • Balance sheet total: €5 million • Turnover (excl. VAT): €10 million • Employees: >50 Proprietary company considered “large” if they meet (Companies Act 1993) meeting either of the following for the two preceding years: • Total assets ≥ NZD 66 million, or • Total revenue ≥ NZD 33 million, or • 1 or more large subsidiaries Audit Obligation Large and medium-sized companies must appoint a statutory auditor (commissaire aux comptes). • FMC reporting entities must have financial statements audited by a licensed auditor. • Large companies (NZ or overseas) must prepare audited financial statements. Lower Thresholds for Subsidiaries Applies when controlled by an entity already audited: • Balance sheet: €2.5 million • Turnover: €5 million • Employees: >25 For overseas companies with subsidiary in New Zealand meeting either of the following for the two preceding years: • Total assets ≥ NZD 22 million, or • Total revenue ≥ NZD 11 million Other Entities that need to conduct an Audit Non Profits are required if annual donations + subsidies exceed €153,000 or if recognized as public utility, issue bonds, or provide microloans. • Charities that spend over NZ$1.88 million for two years in a row must get a full audit from a qualified auditor. • If your charity spends between NZ$938,085.65 and NZ$1.88 million, you can pick either an audit or a review. • Non Profits must conduct an audit if they have annual operating expenses of NZD $500,000 or more or if they receive government funding of NZD $10,000 or more. Public Companies All public limited companies (Société Anonyme – SA) require audits regardless of size. All listed companies need to prepare financial reports. Filing / Submission Timeline Financial statements filed annually with the Greffe du Tribunal de Commerce. Financial statements must be filed or lodged no later than: • 4 months from the balance date for FMC reporting entities, and • 5 months from the balance date for large companies. You can read more about audit requirements in France on our dedicated blog post. Auditor Appointment Appointment of an Auditor in France In France, a statutory auditor (commissaire aux comptes) can be appointed either directly in the company’s founding documents (statuts) or later by a resolution passed at a general shareholders’ meeting. If an auditor has not been appointed or a vacancy arises due to resignation or dispute, the commercial court may designate one to ensure compliance with audit obligations. Compliance with the audit law in France requires companies to appoint both a principal (titular) auditor and an alternate auditor, who steps in if the primary auditor is unable to perform their duties. Auditors must be selected from the official registry maintained by the Haut Conseil du Commissariat aux Comptes (H3C). Rotation rules: Public Interest Entities (PIEs) are required to change their audit firms every 10 years. This rotation period can be extended up to 24 years if the audit firm is appointed through a competitive tender process, ensuring that companies periodically reassess and select their auditors transparently. For companies that are not classified as PIEs, auditors are typically appointed for a term of 6 years, but there is no strict requirement for mandatory rotation. You can read
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Business Opportunities in France for New Zealand Exporters
Business opportunities in France are rapidly emerging as one of the best ways to setup base in the EU for New Zealand. The recently signed EU-NZ Free Trade Agreement (EU-NZ FTA) makes this expansion even more attractive by removing tariffs, simplifying regulations, and opening access to one of the world’s largest economic regions. For businesses looking to gain a competitive edge in Europe, France offers the perfect combination of strategic location, mature infrastructure, and policy support. Key Benefits of EU-NZ FTA The Free Trade Agreement between New Zealand and the European Union (EU-NZ FTA), which came into effect on 1 May 2024, has significantly improved trade conditions. Tariff Reductions on Exports From day one, tariffs were removed on 91% of New Zealand’s goods exports to the EU, with this figure set to reach 97% over a seven-year period, greatly enhancing market access and price competitiveness for New Zealand exporters. As per myNZTE’s economic modeling estimates by 2035 the NZ-EU FTA could increase exports to the EU by up to $1.8 billion per year and generate an extra $1.4 billion to New Zealand’s GDP per year. Specific Goods Benefiting from the EU-NZ FTA Horticulture: Kiwifruit, onions, apples, and other horticultural products enter the EU duty-free from day one. Fish and Seafood: Tariffs eliminated immediately on nearly all fish products and Shellfish. Remaining tariff lines will be fully eliminated over time, reaching 100% at full implementation. Wine: All wine exports, including sparkling and still varieties, are tariff-free from day one. Honey: Mānuka honey tariffs eliminated immediately. Other honey types tariffs will be phased out over 3 years until full elimination. Manufactured Goods: Nearly all manufactured exports are duty-free from the start. Additionally, the remaining tariffs will reach 100% elimination at full implementation. Benefits for Service Providers The EU-NZ Free Trade Agreement introduces commitments that give New Zealand service providers more secure and competitive access to the EU market, aligning their treatment with that of the EU’s existing trading partners. For example, New Zealand education service providers can now offer a broader range of services, including language, sports, and recreational education within the EU. Moreover, New Zealand and the EU have agreed to commitments on a broader range of aviation services, including commitments on delivery, telecommunications, financial services, and international maritime transport. The agreement includes contractual service supplier provisions, enabling experts from both sides to operate in each other’s markets. This promotes skills transfer, workforce development, and greater service delivery flexibility for New Zealand firms operating in Europe. Benefits for Investors NZ’s investment screening threshold will be raised to NZ$200 million, aligning with thresholds offered to other key FTA partners. But the Overseas Investment Act framework remains in place. However, the agreement does not include investor-state dispute settlement (ISDS) mechanisms, reflecting New Zealand’s longstanding opposition to ISDS clauses. The FTA removes performance requirements such as: Export quotas or restrictions Mandatory local headquarters Enforced levels of R&D spending Obligatory local employment quotas Improved market access rules mean greater flexibility for investors, including: No restrictions on the type of legal structure or joint venture model foreign investors may choose Simplified entry for EU investors into a wide range of economic activities in New Zealand Movement of People for Business The FTA includes a dedicated annex on the movement of businesspersons, ensuring more predictable access and application procedures for professionals. The agreement outlines specific commitments for these categories: Intra-corporate transferees Independent professionals Business visitors Contractual service suppliers Additionally, Specialist staff are allowed to stay in the EU for up to 3 years, supporting long-term assignments and knowledge transfer. Business visitors entering for establishment purposes can stay for up to 90 days within a 6-month period, streamlining short-term setup or negotiation activities. These provisions make it easier for New Zealand businesses to send personnel to the EU, facilitating smoother cross-border operations and project delivery. Why Choose France? Choosing the right launchpad in Europe is critical to export success. France stands out as one of the top choices for New Zealand exporters due to several key advantages: Geographical Location & Market Reach Centrally positioned in Western Europe with land borders to 8 EU countries. Home to Europe’s second-largest consumer market, after Germany. Fast, multimodal transport access via high-speed rail, airports, and major ports (Le Havre, Marseille, etc.). Economic Strength France is the 7th-largest economy in the world by GDP. Member of both the Eurozone and Schengen Area, simplifying movement of goods, people, and capital. Political stability and a well-developed legal system enhance business confidence. Member of the Schengen Area and Eurozone — Streamlined Operations Schengen Area membership allows passport-free movement across 26 EU countries, facilitating business travel and expansion. Faster cross-border logistics thanks to reduced customs checks and harmonized transport rules. Eurozone membership means France uses the euro, simplifying transactions with other EU nations. This reduces foreign exchange risk and simplifies cross-border invoicing and payments. Funding & Startup Ecosystem Innovative New Zealand businesses launching in France can tap into generous R&D tax credits and financial support. The government-backed La French Tech initiative offers resources, tax incentives, and entry points for international startups. Station F, located in Paris, is the largest startup campus in the world and welcomes founders globally. Many regional French authorities offer additional support programs and funding to attract international tech talent and investment. Business Opportunities in France for New Zealand Exporters by Sector Food & Beverage Top F&B exports from New Zealand to France include lamb, seafood, apples, kiwifruit, and wine. Seafood: France ranks as the 9th-largest destination for New Zealand seafood, mainly frozen hoki, mussels, orange roughy, and processed fish meat. Wine: New Zealand wines have established a niche in the French market, particularly within foodservice channels and specialty retail outlets. Consumer trends: Strong demand for organic, ethical, and sustainably sourced food products makes France an ideal market for New Zealand producers with eco-conscious branding. Specialised Manufacturing France offers growing demand for innovative manufacturing solutions, including: Construction and building materials Marine equipment Automotive and aviation parts Food processing machinery Plastics and packaging Success
Publishing Sustainability Reports – Is it Mandatory in New Zealand?
In this blog we discuss what is sustainabily reporting, why is it important and is it mandatory to publish sustainability reports in New Zealand.