ATO, Auditing

TPB action key to deterring SAN misuse

SAN misuse

The ATO has welcomed the TPB’s action against tax practitioners who engaged in fraudulent misuse of SMSF auditor numbers (SAN).

The ATO has welcomed the Tax Practitioners Board’s (TPB) recent action against tax agents found to have engaged in SMSF auditor number (SAN) misuse.

ATO SMSF auditor portfolio director Kellie Grant said recent action taken by the TPB against tax practitioners for fraudulently reporting a SAN, including its decision to ban a Gold Coast-based tax agent for four years, would serve as a deterrent for other practitioners.

The tax practitioners were referred to the TPB after they were found to have provided false information to the ATO.

“What’s been really encouraging to see is some strong results coming out of the TPB in respect of tax agents who deliberately misused a SAN,” Grant said at the SMSF Association Technical Day 2020 yesterday.

In addition to the four-year ban of one tax agent, the TPB suspended another agent for six months from providing tax agent services and 12 months from providing SMSF services for his role in lodging over 30 returns using the SAN of an auditor who had not completed any audits.

The TPB also issued written cautions to four tax practitioners for breaches of the Tax Agents Services Act 2009.

“Other sanctions imposed included auditors [being asked] to complete certain TPB-approved training courses and conditions on registration which prevent the tax agent from providing tax agent services or supervising tax agent services in relation to just SMSFs,” Grant added.

“With those TPB outcomes, we think they should serve as a deterrent for other tax agents who look to deliberately misreport a SAN.”

In addition to the tax agents referred to the TPB, she confirmed a few auditors who had engaged in SAN misuse had been referred to the ATO’s prosecutions area.

“That’s where the SAN misuse was really considered quite serious because the auditor either retained audit fees for clients and didn’t end up arranging those audits, or had actually even gone as far as forging the audit report,” she said.

She also said auditors must factor in recent changes to the Code of Ethics for Professional Accountants to ensure they were not in breach of new independence standards.

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