SMSF auditors still falling short

Self-managed superannuation fund (SMSF) auditing continues to be an issue for the regulators, with the Australian Taxation Office (ATO) referring more than half of nine auditors penalised by the Australian Securities and Investments Commission.

ASIC has confirmed that of the nine SMSF auditors penalised in the last quarter of last year, five had been referred to it by the ATO.

The ASIC action has come despite a sustained campaign with respect to SMSF auditing over the past five years.

ASIC said it had taken action against the SMSF auditors “where we formed the view that conduct did not meet the required standards”.

“This included concerns about compliance with auditing and assurance standards, independence requirements, registration conditions or not being a fit and proper person to remain an auditor.”

ASIC deputy chair, Sarah Court said that between 1 October and 31 December, last year, ASIC:

• Disqualified five SMSF auditors,
• Imposed additional conditions on two SMSF auditors, and
• Cancelled the registration of two SMSF auditors.

ASIC said Stephen Bray, Kerpal Harnam, Terence Murphy, Johann Preller and David Sidhu were disqualified from being SMSF auditors with their names placed on ASIC’s public banned and disqualified register and are not eligible to reapply for registration.  Murphy requested ASIC review its disqualification decision which is currently under consideration.

It said Timothy Davidson and Kylie Wilson had additional conditions imposed on their SMSF auditor registration. Conditions are specific to the auditor and can require undertaking additional professional development, passing the SMSF auditor competency exam, having independent reviews of SMSF audit files and/or audit tools, templates and methodology and notifying their professional accounting association of the additional conditions.

Vincenzo Dissidomino and Vincent Crowe had their SMSF auditor registration cancelled.