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ATO provides clarity on offshoring and independence standards


The ATO has provided its views on the outsourcing of accounting and auditing services to offshore providers in relation to meeting the updated auditor independence standards.

By Miranda Brownlee2 minute read

ATO director, SMSF auditor portfolio, Kellie Grant said the ATO has received inquiries around outsourcing to offshore providers in relation to the restructured APES 110 code and APES 110 code and APESB Independence Guide.


Ms Grant said one firm asked if they outsourced both the accounting and auditing to an offshore provider, would that mean they could retain the administration and auditing services for their SMSF clients?

“However, outsourcing does not absolve the accountant of the primary responsibility for both functions,” Ms Grant explained.

“The accountant or auditor still has to sign off on the preparation of the fund’s accounts or the audit.”

The ATO, she said, has also been asked questions around whether firms with multiple offices in different states could retain both the accounting and audit functions for a client if the two functions were completed by two separate offices.

“One firm asked us if they were part of a national firm but had a separate office in each state where there was no cross-sharing of profits among partners across those states, would there be independence issues if one state office audited the clients of another state office?” she said.

“Of course, there would be in this situation because the firms belong to a network of firms that share a common brand name, so an auditor could be hesitant to qualify the audit report of a client who is receiving other services for the fund from the same network firm.” 

ATO provides clarity on offshoring and independence standards
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Miranda Brownlee

Miranda Brownlee


Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.

Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.

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