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SMSF auditors disciplined by ASIC

ASIC has named a number of SMSF auditors that it has had to disqualify, suspend or impose conditions due to concerns about failures to meet independence and auditing standards.

SMSF Adrian Flores 23 April 2020
— 1 minute read

In addition, ASIC said in a statement it also had concerns these auditors were failing to comply with continuing professional development (CPD) requirements and otherwise not being a fit and proper person.

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Disqualified SMSF auditors

ASIC noted the disqualification of the following SMSF auditors:

  • Kent Hacker of Queensland, for significant auditor independence breaches, deficiencies in auditing asset valuation and compliance arm’s-length transaction requirements, and for otherwise not being a fit and proper person as he had failed to comply with undertakings made to the ATO.
  • Sofranios Vlahos of New South Wales, for significant auditor independence breaches.
  • Stephen Sproats of New South Wales, for significant auditor independence breaches and deficiencies in auditing asset valuation and ownership, compliance with arm’s-length transaction requirements and compliance with borrowing requirements.
  • Mark Higgins of New South Wales, for significant auditor independence breaches, deficiencies in auditing asset valuation and compliance with financial reporting requirements, failing to obtain signed financial statements and breaching CPD requirements. 

SMSF auditors given suspension and conditions imposed

ASIC also said it imposed one-year suspensions and conditions on the following SMSF auditors:

  • Ronald Cuthbertson of Western Australia, for deficiencies in auditing the valuation of fund assets, compliance with separation of fund and trustee asset ownership, compliance with related-party and arm’s-length requirements and compliance with personal use and collectable asset rules; and failing to report a fund contravention to the ATO as required.
  • Malcolm Heasman of Western Australia, for auditor independence breaches; deficiencies in engaging, planning and performing audits; and deficiencies in auditing the valuation of assets, compliance with separation of fund and trustee asset ownership, and compliance with financial reporting requirements.

“Mr Cuthbertson must undertake a peer review process for his audits, complete specific courses of studies, including in ethics and audit, and pass an SMSF competency exam,” ASIC said.

“Mr Heasman must undertake a peer review process for his audits, certify to ASIC that he has not conducted audits in specific circumstances related to independence, complete specific courses of study, including in ethics and audit, review tools and templates to ensure they are up to date and complete, and pass an SMSF auditor competency exam.

“Mr Heasman is also restricted from conducting any audits in independence threat situations regardless of any safeguards.”

SMSF auditors disciplined by ASIC
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