Audit and review requirements for Australian Entities

Transcription

1 Audit and review for Australian Entities This guide provides a summary of the legislative to prepare s, have an audit or review of those s performed and the qualifications of auditors and reviewers for common types of Australian entities. It is not intended to be exhaustive. As legislative change, members should confirm the with the relevant regulators. Institute ICAA Regulation 4/702.1(b): if you provide public accountancy services required under legislation or other statutory authority to the public for reward, a Chartered Accountant (CA) requires a Certificate of Public Practice (CPP). Federal legislation Entity type Financial Report requirement Corporations Act 1 - Public interest entity: - Disclosing entity - Public company - Registered Scheme s (s292(1)) Corporations Act 1 - Proprietary Company: - Large 2 s (s292(1)) Audit / Review requirement (s301(1)) unless ASIC provides exemption (s301(1)) Auditor / Reviewer conditions an Registered Company Auditor () (s324ba) unless ASIC approves otherwise (s324bd) Other Reg Reg Small 3 Financial report only if directed (s292(2)) Audit only if required by the director/asic direction (s301(2)) Corporations Act 1 - Company Limited by Guarantee: Revenue over $1m s (s292(1)) (s301(1)) If audited, the auditor must be unless ASIC approves otherwise (s324bd) (s324ba) Reg Reg Corporations Act A proprietary company is considered large if it has at least two of: consolidated revenue $25million, consolidated gross assets $12.5 million or company/group has 50 employees. S 45(1)(3). 3 A proprietary company is considered small if it has at least two of: consolidated revenue < $25million, consolidated gross assets < $12.5 million or company/group has less than 50 employees. S 45(1)(2).

2 Revenue under $1m but over $250,000 Revenue under $250,000 Charities and NFP Act 4 Revenue over $1m Revenue under $1m but over $250,000 Revenue under $250,000 SIS 6 Act Superannuation Fund SMSF (s292(1)) No need for unless directed by members or ASIC (s292(3)) s 5 s s60-10 No need for s60-10 s s35b s s35b Audit only if requested If not audit, must have review (s301(3)) No audit or review required unless directed s60-25 May be audited or reviewed s60-20 Reviewer may CA (or member of other two bodies) with CPP (s324be) If audited or reviewed, the auditor must be Reviewer may CA (or member of other two bodies) with CPP (s324be) s60-30 Reviewer may be CA (or member of other 2 bodies) S60-30 No audit required s35c s35c An approved auditor is an or an Auditor General (or delegate of an A- G) Reg registered SMSF auditor s10(1) Reg Members of the subject to the relation to insurance held by Reg Members of the subject to the relation to insurance held by As an the under the the Corps Act Reg As an the under the the Corps Act Reg Australian Charities and Not-for-profits Commission Act Unless the entity is a basic religious charity 6 Superannuation Industry (Supervision) Act 1993

3 Co-operatives National Law (Draft regulations) Small (as defined in regulation 1.5 Has not raised funds from public issue in last fin year and at least 2 of revenue less than $8m, gross assets less than $4m and less than 30 employees) Large or have issued securities publicly in last financial year If no member direction must prepare financial report complying with Regulation 3.10 s270(3) If member direction must prepare full s270(2) s s270(1) If no member direction no audit or review required s276(2) Members may direct financial report to be audited or reviewed s276(3) s276(1) s276 Reviewer qualification not specified s276 State legislation (Incorporated Associations) Financial Report Audit / Review Auditor / Reviewer Entity type requirement requirement conditions ACT Associations Incorporations Act 1991 and Regulations Prescribed association(gross receipts or gross assets > $150,000 or more than 1,000 members or holds a licence under the Liquor Act 2010) s72 s74 or member of the bodies. If gross receipts > $500,000 then must be. May not be: a) An officer of the association, or b) A partner, employer or employee of an officer of the association, or c) A partner or employee of an employee of an officer of the association. s74(3) Other auditor, the auditor must have Not prescribed association a s72 s74 a person who: a) Is not an officer of the association; and b) Has not prepared or assisted with the preparation of those accounts. s74(2)

4 Northern Territory Associations Act and Regulations Tier 1 association (one of revenue < $25k or gross assets < $50k a s 43(1) s43(1) a person who: a) is not a member of the association b) is not the spouse or de facto partner or a business partner, employer or employee of a member of the association, or c)is not the spouse or de facto partner or a business partner of an employee of a member of the association. s46(1) Tier 2 association (one of revenue > $25k & <$250k, gross assets > $50k and <$500 or holds a gaming machine licence a s 43(1) s43(1) The auditor must be a) A person who is a member of an accountants body b) A person who holds qualifications in a prescribed class of qualifications, or c) A person who is, or is a member of a class of persons, Commissioner. s47(2) Tier 3 association (one of revenue >$250k, gross assets >$500k or performs local govt functions a s 43(1) s43(1) The auditor must be a) a person who holds a public practice certificate issued by an accountants body b) a person who is, or is a member of a class of persons, Commissioner, or c) a person who is registered as an auditor under the Corporations Act s48(2) auditor must have

5 New South Wales Associations Incorporations Act 2009 and Regulations 2010 Tier 1 s43(1)(a) Financial report must be audited S43(1)(b) The audit must be carried out by: a) a registered company auditor within the meaning of the Corporations Act 2001; b) a person approved by the Director- General. s52(1) Any person who is, or who has art any time within the last two years been, a member of the association or an employer of a provider of professional services (other than audit services) to the association or to a committee member or public officer of the association may not carry out the audit. s52(2) auditor must have Tier 2 s47 Audit not required Holder of authority to conduct a fundraising appeal 7 Financial report must be audited s24 or Minister. s24 South Australia Associations Incorporations Act 1985 and Regulations 2008 Prescribed association (gross receipts > $500,000) s35(2)(a) Financial report must be audited s35(2)(b), member of CPA Australia or ICAA or otherwise Commission. s35(2)(b) Queensland Associations Incorporations Act 1981 and Regulations 1999 Level 1 (either current assets >$100,000 or revenue >$100,000) financial statement as defined in the Act s59(2)(a) Audit required s59(2)(b)(i) Audit must be performed by auditor () or accountant (member of the bodies entitled to use their respective designations). s58 s59(2)(b)(i) auditor must have bodies are 7 Charitable Fundraising Act 1991

6 i.e a member who is entitled to use the CA or FCA designation. and insurance Level 2 (either current assets > $20,001 <$100,000 or or revenue > $20,001 < $100,000) financial statement as defined in the Act s59(2)(a) Audit required if required under Collections Act 1966, Gaming Machine Act 1991 or any other law s59(2)(b)(ii) If audit required, auditor must be, accountant as above or approved person. s58 s59(2)(b)(ii) bodies are and insurance Level 3 (either current assets >$100,000 or revenue >$100,000) financial statement as defined in the Act s59(2)(a) Audit not required unless specified under Collections Act 1966, Gaming Machine Act 1991 or any other law. If audit required, auditor must be, accountant as above or approved person s58 s59(2)(b)(ii) Tasmania Associations Incorporations Act 1964 and Regulations 2008 Total revenue > $40,000 a s24(1) Financial report must be audited S24(1) or otherwise Commissioner s24(1) Audit required if specified under Collections Act 1966, Gaming Machine Act 1991 or any other law. Commissioner s approval is subject to having regard to the complexity of the financial affairs of the association. Total revenue < $40,000 a. If granted audit exemption must only prepare income and expenditure statement. s24b(1a) May apply for audit exemption, otherwise must have audit s24 Where audit is required, auditor must be or otherwise Commissioner s24(1) Commissioner s approval is subject to having regard to the complexity of the financial affairs of the association.

7 Western Australia Associations Incorporation Act 1987 and Regulations 1988 All No requirement to lodge accounts but must submit accounts to AGM s26 No requirement for audit but may be specified in rules of association s25(c) As specified in rules of the individual association Victoria - Associations Incorporations Reform Act 2012 and Regulations 2012 Tier 1 (Revenue < $250,000) s92 Review may be requested s93 Where a review is request the Reviewer must be member of one of the bodies with CPP or otherwise approved by the Registrar. s96(1)(a) Tier 2 (Revenue > $250,000 and <$1,000,000) s95 Review required s96 Reviewer must be member of one of the bodies with CPP or otherwise approved by the Registrar. s96(1)(a) Tier 3 (Revenue > $1,000,000) s98 Must have an audit s99, member of one of the bodies with CPP or otherwise approved by the Registrar. s99(2) Disclaimer June 2013 Copyright The Institute of Chartered Accountants in Australia All rights reserved. This publication is copyright. Apart from any use as permitted under the Copyright Act 1968, it may be copied, published or communicated in any form or by any means, provided that it is not amended or adapted without the prior written consent of The Institute of Chartered Accountants in Australia and the ownership of copyright by The Institute of Chartered Accountants in Australia must be attributed at all times. This document was prepared by The Institute of Chartered Accountants in Australia. The information in this document is provided for general guidance only and on the understanding that it does not represent, and is not intended to be, advice. It is not intended to address the circumstances of any particular individual or entity. While care has been taken by The Institute of Chartered Accountants in Australia in its preparation, it should not be used as a substitute for consultation with professional, tax, legal or other advisors. There can be no guarantee that the information contained in this document is accurate as of the date it is received or that it will continue to be accurate in future. Before making any decision or taking any action, you should consult with an appropriate

8 specialist or professional. No warranty is given to the correctness of the information contained in this document, or its suitability for use by you. To the fullest extent permitted by law, no liability is accepted by The Institute of Chartered Accountants in Australia for any statement or opinion, or for an error or omission or for any loss or damage suffered as a result of reliance on or use by any person of any material in the document. ISBN: The Institute of Chartered Accountants in Australia. Formed in Australia. Institute are not liable for the debts and liabilities of the Institute. ABN