Acting SMSF assistant commissioner Paul Delahunty told SMSF Adviser in a statement that the regulator will be “rolling out more high-volume SMSF auditor reviews as part of our SMSF auditor compliance plan for 2024-25. This work will be done nationally and in conjunction with our usual high-risk auditor work program”.
“The purpose of these reviews is to build a stronger level of understanding of the auditor’s operations so we can get a level of assurance that the largest audit firms have controls, processes and procedures in place that are appropriate and operate effectively,” he said.
“Among other things, as part of this work, we look to ensure that these firms maintain independence and that their audit staff have the necessary competence to identify and address compliance risks in the SMSFs they audit.”
He added that the ATO expects to report the review program’s outcomes at the end of the financial year.
Delahunty said SMSF auditors play a vital role in maintaining the integrity of the superannuation system.
“Each year, SMSF trustees are required to appoint an SMSF auditor who then carries out the annual financial and compliance audit of the fund’s operations before the annual return can be lodged.”
“It is necessary that SMSF auditors have a high standard of competency and independence to ensure that SMSF audits can be relied upon to provide an objective assessment of compliance with the superannuation legislation.”
He continued that as a co-regulator of SMSF auditors with ASIC, the ATO’s objective is to ensure that SMSF auditors are performing independent and adequate audits by complying with their professional obligations to protect SMSF members’ retirement savings and the integrity of the superannuation system.
In March this year, the ATO used data analysis to target 16,500 SMSFs that reported the same value for certain classes of assets, primarily direct property and unlisted companies and trusts for the last three or more years.
It also sent communications to more than 1,000 SMSF auditors associated with this “high-risk” population after they failed to raise auditor contravention reports.
Earlier this month, ASIC took action against the registration of 13 approved SMSF auditors over a number of concerns including breaches of auditing and assurance standards, independence requirements, continuing professional development obligations, or not being a fit and proper person to remain an approved SMSF auditor.
This follows action against 15 SMSF auditors in March 2024 who were engaged in “in-house audits”.
