ASIC, Auditing

ASIC acts on SMSF auditor misconduct

ASIC SMSF auditors misconduct

ASIC has disqualified two SMSF auditors and added conditions to the registration of another following referrals from the ATO related to misconduct.

The Australian Securities and Investments Commission (ASIC) has taken action over the misconduct of three SMSF auditors following concerns they had failed to meet ASIC requirements.

The corporate regulator disqualified Darryl Iseppi of Queensland and Alan Bentwich of New South Wales from being SMSF auditors and imposed conditions on Richard Hennessy of NSW after they were referred to ASIC by the ATO.

“The actions arose following ASIC concerns about failures to meet requirements, including independence standards and auditing standards, or failing to comply with further conditions on the approved SMSF auditor’s registration,” it said.

Iseppi was disqualified for significant auditor independence breaches and deficiencies in auditing the acquisition of shares, borrowings, valuation of assets, compliance with in-house asset requirements and regarding a non-commutable life pension.

Bentwich was disqualified for failing to comply with a condition to have peer reviews of three of his audits. ASIC had imposed the condition following a past referral from the ATO.

The conditions imposed on Hennessey were for deficiencies in maintaining auditor independence and in audit work, including auditing the ownership and valuation of fund assets and ensuring compliance with legislative borrowing requirements.

“The conditions imposed included having audits reviewed by another SMSF auditor, not auditing funds where there are independence threats irrespective of the safeguards, completing specified courses in ethics and auditing, and providing his professional association with a copy of the conditions,” ASIC said.

The regulator pointed out the Superannuation Industry (Supervision) Act 1993 required all SMSF auditors to be registered by ASIC to ensure auditors of SMSFs met base competency and expertise standards.

“SMSF trustees and members can check whether their auditor is registered and what conditions are on their registration by searching ASIC’s SMSF auditor register,” it noted.

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