The Australian Taxation Office has issued a warning that self-managed super fund auditors need to have performed audit work regularly to maintain the practical experience necessary to do their job properly.
The ATO says it is writing to about 100 auditors who have not been reported as the auditor of an SMSF annual report in the past five years. It will be asking them to show why they believe they still have the skills to audit SMSFs.
The ATO says SMSF auditors are required to maintain their practical experience as well as continuous professional development. They must also have up to date professional insurance.
The ATO’s warning is the latest reminder to trustees that they need to check the bona fides and experience of their auditors. Over the past couple of years the Australian Securities and Investments Commission has told trustees that their auditor must be independent and registered.
Since 2013, the superannuation rules have required that all SMSF auditors be registered with ASIC. The regulator says trustees can check whether their auditor is registered by searching its SMSF auditor register.
Last year ASIC reported that it had cancelled the registration of 117 SMSF auditors. The auditors had not lodged their annual statements or paid their fees.
In August last year, ASIC released a review of its enforcement activity in the first half of 2018, which showed that in the area of corporate governance, where the focus is on investor and consumer protection, 57 per cent of enforcement action was against SMSF auditors, 29 per cent against company directors and 14 per cent against liquidators.
The issues dealt with included non-compliance with auditor independence requirements, non-compliance with auditing standards, false and misleading conduct, fraud and bankruptcy.