Auditor rotation set for Australian firms

Auditor rotation set for Australian firms

Relief proposal put out for discussion

The Australian securities watchdog is seeking comment on a new policy
proposal paper regarding its power to give relief from auditor rotation
obligations.

Australian auditors will from 1 July this year have to comply with new rules
put out by the Australian Securities and Investments Commission governing the
length of time they can audit a listed company or managed investment scheme.

‘Our discussions with industry indicate that there is a high level of
awareness about the auditor rotation requirements and that audit firms are
already planning what they will need to do to comply with the obligations from 1
July 2006,’ ASIC’s executive director of regulation, Malcolm Rodgers said.

The issues raised in proposal include:

• the expectation that auditors will undertake a self-assessment of
eligibility;
• how ASIC can expect to be notified of any contraventions;
• when ASIC considers that the auditor rotation obligations will create an
unreasonable burden justifying some relief; and
• what ASIC expects to see in an application for relief from the auditor
rotation obligations.

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