EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.
Recent Searches
Upholding independence is fundamental to our commitment to audit quality and stakeholder trust. The Independence function plays a strategic role, facilitating objectivity and integrity throughout the audit lifecycle. This includes protocols such as pre-clearing services, conflict checks, monitoring financial interests and rotating audit personnel.
By integrating independence as a foundational element of the audit process, we strengthen confidence in the capital markets and deliver long-term value to stakeholders.
Content overview
- EY Global Independence Policy
- Global Independence System
- Global Monitoring System
- Independence compliance
- Independence confirmation
- Personal independence compliance testing
- Non-audit services
- Global independence learning
- Service Offering Reference Tool
- Business Relationships Independence Data Gathering and Evaluation
- Audit committees and oversight of independence
The EY Global Independence Policy requires EY member firms and people to comply with independence standards for each engagement, including the International Ethics Standards Board for Accountants’ (IESBA) International Code of Ethics.
We consider and evaluate independence across several aspects, including:
- Financial relationships — of EY member firms and of EY professionals and other personnel
- Employment relationships
- Business relationships
- Permissibility of services we provide to audit clients
- Firm and partner rotation requirements
- Fee arrangements
- Audit committee pre-approval or pre-concurrence, when required
- Partner remuneration and compensation
Failure to comply with applicable independence requirements will factor into decisions relating to a person’s promotion and compensation and may lead to other disciplinary measures, including separation.
EY Global Independence Policy
The EY Global Independence Policy sets out the independence requirements for EY member firms and people. It is based on the IESBA Code and, where required, includes stricter rules from local laws, regulators or standard-setting bodies. The policy also provides guidance to help people understand and apply independence rules.
The EY Global Independence Policy is readily accessible and easily searchable on the EY intranet. It is an intellectual resource provided by a global function to drive consistency in the System of Quality Management.
Global Independence System
The Global Independence System (GIS) is an intranet-based tool that helps EY people identify entities where independence is required and the restrictions that apply. It lists all independence-restricted entities comprised of EY audit clients and their affiliates, including listed audit clients, other public interest audit clients and private audit clients and includes other types of attest clients.
GIS also provides family-tree data for audit clients and their affiliates, as well as other entities with or without independence restrictions. This data is validated by client-serving engagement teams. Each entity includes notes showing the independence requirements that apply, making it easier to determine which services can be provided and what relationships or interests are allowed.
GIS is an example of a technological resource made available to EY member firms to drive consistency in the System of Quality Management.
Global Monitoring System
The Global Monitoring System (GMS) is a key tool that helps identify restricted securities and other impermissible financial interests. EY professionals ranked as manager and above are required to enter details of all securities they hold, as well as those held by their immediate family, into GMS. If a restricted security is entered — or if a security becomes restricted — the professional receives a notice and must dispose of it. Any exceptions are reported through our Independence Consultation Database (ICD), which is designed to track independence consultations and document related regulatory matters.
GMS also supports annual and quarterly confirmations of compliance with independence policies, as outlined below. It’s another technology resource provided to EY member firms to drive consistency across the System of Quality Management.
Independence compliance
EY processes and programs are aimed at enabling and monitoring the compliance with independence requirements of EY member firms and their people. These include the following activities, programs and processes.
Independence confirmation
All EY client-serving professionals from manager through partner — and certain other personnel based on their role or function — must confirm compliance with independence policies and procedures quarterly. In addition, all EY people subject to the personal independence policy requirements confirm compliance annually.
All EY professionals are also required to confirm compliance with the EY Global Code of Conduct each year.
Personal independence compliance testing
Each year, the EY Global Independence team executes a Personal Independence Compliance Testing (PICT) program. This program assesses whether individuals have properly reported their financial interests in GMS. It is led by the Country Independence Leader for each EY member firm.
As part of PICT, selected individuals provide account statements and other documentation of their financial interests. These are compared with the information reported in GMS for the relevant period to identify any unreported interests or relationships. Any unreported interests are reviewed and consequences are applied as appropriate.
Non-audit services
EY enables and monitors compliance with professional standards, laws and regulations that govern non-audit services for audit clients through several mechanisms. Enablement includes tools like the EY Process for Acceptance of Clients and Engagements (PACE), GIS, the Service Offering Reference Tool (SORT) and training. Monitoring happens through required procedures during audits and internal inspection processes.
There is also a process in place for the review and approval by Independence professionals of certain non-audit services in advance of accepting the engagement.
Global independence learning
EY provides independence training programs for all client-facing professionals and certain other personnel based on their role or function. These individuals are required to complete annual independence learning to help maintain independence from EY audit clients.
The goal is to help EY professionals (and other personnel based on their role or function) understand their responsibilities and enable each of them — and their member firms — to identify and avoid interests that could compromise objectivity, integrity or impartiality when serving an audit client.
The annual independence learning program covers key independence requirements, highlighting recent policy changes along with recurring themes and important topics. Timely completion of this training is mandatory and closely monitored. EY member firms may add local content that is incremental to the EY Global Independence Policy to address local independence requirements.
In addition to the annual learning program, we promote independence awareness through events and materials such as new-hire programs and core service line curricula.
The annual independence learning program is an example of an intellectual resource provided by a global function to drive consistency in the System of Quality Management.
Service Offering Reference Tool
The Service Offering Reference Tool (SORT) is the master list of approved EY services. We regularly review and assess our service portfolio to make sure each offering complies with professional standards, laws and regulations. This process also confirms we have the right methodologies, procedures and controls in place as new services are developed.
Services that could create undue independence or other risks are restricted and cannot be provided.
SORT also gives EY people detailed information about our service offerings. It includes guidance on which services can be provided to audit and non-audit clients, along with considerations related to independence and other risk management issues.
SORT is an example of a technological resource made available to EY member firms to drive consistency in the System of Quality Management.
Business Relationships Independence Data Gathering and Evaluation
EY people are required to use the Business Relationships Independence Data Gathering and Evaluation (BRIDGE) tool in many situations to identify, evaluate and obtain advance approval for a potential business relationship with an audit client. This process supports compliance with independence requirements across the global EY organization.
BRIDGE is an example of a technological resource made available to EY member firms to drive consistency in the System of Quality Management.
Audit committees and oversight of independence
We recognize the critical role of audit committees and similar governance bodies in overseeing auditor independence. These empowered and independent committees and bodies act on behalf of shareholders to protect independence and prevent conflicts of interest.
We are committed to clear, regular communication with audit committees and similar bodies. Through EY quality review programs, we monitor and test compliance with our standards for these communications, as well as the required pre-approval or pre-concurrence for non-audit services, where applicable.