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14-335MR ASIC cancels registrations of SMSF auditors
ASIC has cancelled the registration of 440 Self-managed superannuation fund (SMSF) auditors who did not undertake or pass a competency exam necessary to retain their registration.
ASIC has also disqualified two SMSF auditors whose application for registration had overstated the number of SMSF audit reports issued by them in the preceding 12 months, thereby avoiding the requirement to sit the competency exam.
Of the 440 auditors whose registration was cancelled, 373 did not attempt the exam and 67 did not pass the exam.
Auditors were given up to two attempts to pass the exam and ASIC extended the period to pass the exam to 31 August 2014.
Commissioner Greg Tanzer said, 'As the SMSF sector continues to grow in popularity with Australian investors, it is critical that SMSF auditors play their key gatekeeping role. ASIC will continue to administer the registration process to assure Australians that SMSF auditors at least meet base standards of competency and expertise'.
SMSF auditors who have had their registrations cancelled can re-apply for registration if they have passed the competency exam in no more than two attempts over the preceding 12 months. ASIC Regulatory Guide 243 Registration of self-managed superannuation fund auditors contains more information on how to apply to be an SMSF auditor.
ASIC and the Australian Taxation Office (ATO) work closely together as co-regulators of SMSF auditors. The ATO monitors SMSF auditor conduct and may refer matters to ASIC for possible disqualification or suspension of their registration.
SMSF trustees/ members can check whether their auditor is registered by searching ASIC's SMSF auditor register at connectonline.asic.gov.au.
If a member/trustee is concerned that their SMSF auditor is not registered, they can report this to ASIC through our website at www.asic.gov.au.
From 1 July 2013, the Superannuation Industry (Supervision) Act 1993 (the Act) required all auditors of SMSFs to be registered with ASIC. The objective was to ensure that all SMSF auditors met minimum competency requirements.
New SMSF auditors are required to pass a competency exam in order to be registered. However, SMSF auditors who applied to be registered before 1 July 2013 and were a registered company auditor or had audited 20 or more SMSFs in the preceding 12 months were not required to sit the competency exam.
ASIC approved 7,038 of the SMSF auditor registration applications received before 1 July 2013 with 1,421 of these being registered on the condition that they pass the exam by 1 July 2014. The SMSF auditors with an exam condition had audited less than 20 SMSFs in the 12 months prior to their application and were not registered company auditors.