Darren Snyder writes a piece for the website Financial Standard where he talks about the disqualification of the third auditor by the Australian Securities and Investments Commission (ASIC). The auditor at the receiving end of the ASIC’s whip is James Dermody.
Crime of the Disqualified auditor
He is alleged of signing the auditor independence declaration and the independent auditor’s report for a couple of companies for the year ending June ‘13’ and June ‘14’at a time when he wasn’t a registered company auditor (as per the Corporations Act 2001).
ASIC stiffly monitoring compliance breaches
ASIC is all geared up to take notice of any unwarranted occurrence in the SMSF sector. It believes that the auditors are ‘gatekeepers’ of the sector and they will do the industry harm if they themselves resort to unlawful activities and compliance breaches.
ATO and ASIC working in tandem
1 July 2013 onwards, each auditor is expected to be registered with the ASIC. The move was aimed at ensuring that each auditor kept abreast with minimum requirements of expertise and competence. The ATO and the ASIC are doing a commendable job of monitoring the SMSF auditors. If the ATO finds any problem with them, they push the matter to the ASIC which takes up subjects like disqualification.
You can read the original article here.
In a volatile segment not governed by prudential regulation, it is crucial to keep an eagle-eye on the auditors. If they let unregulated financial products slip in or unethical activities of SMSF owners pass, it will become mighty difficult to control and manage the sector. While the penalty regime lately introduced is harsh, it is not a deterrent if SMSF owners get the support of auditors. This is why the ASIC’s move of stiffly monitoring the auditors may pay rich dividends.
