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The responsibility of auditors even in case of inertia

Civil Supreme Court, section I, Judgement no. 18770 of 12 July 2019. Pres. Dido. Est. Loredana Nazzicone

date: 01.05.2020
Area: Corporate, M&A

For the purposes of exonerating the statutory auditors of a company from liability, it is not sufficient to prove that they have been kept in the dark about the illicit management conduct of the directors, nor is it enough to prove that they took office after the actual occurrence of the damaging facts. In fact, in its ruling no. 18770 of July 2019, the Italian Supreme Court clarified that if the statutory auditors behaved in an inert manner, failing to adequately monitor the conduct of the directors, they may be held accountable with them. In fact, the Italian Supreme Court specified that, in performing their duties, the statutory auditors have the burden of verifying the conduct of directors and, if necessary, remedy it. As a result, the statutory auditors will be held accountable together with the directors if, the use of the powers of the Board of statutory auditors, in accordance with the duties of the office, could have brought to light the unlawful conduct and contrasted it, thus preventing further damage.

The responsibility of auditors even in case of inertia

Civil Supreme Court, section I, Judgement no. 18770 of 12 July 2019. Pres. Dido. Est. Loredana Nazzicone

date: 01.05.2020
Area: Corporate, M&A

For the purposes of exonerating the statutory auditors of a company from liability, it is not sufficient to prove that they have been kept in the dark about the illicit management conduct of the directors, nor is it enough to prove that they took office after the actual occurrence of the damaging facts. In fact, in its ruling no. 18770 of July 2019, the Italian Supreme Court clarified that if the statutory auditors behaved in an inert manner, failing to adequately monitor the conduct of the directors, they may be held accountable with them. In fact, the Italian Supreme Court specified that, in performing their duties, the statutory auditors have the burden of verifying the conduct of directors and, if necessary, remedy it. As a result, the statutory auditors will be held accountable together with the directors if, the use of the powers of the Board of statutory auditors, in accordance with the duties of the office, could have brought to light the unlawful conduct and contrasted it, thus preventing further damage.