Nicholas Benbow, director of William Buck Audit (Vic), has settled a $20,625 penalty for not adhering to audit rotation mandates, marking a precedent in ASIC’s enforcement of audit standards.
ASIC’s action comes after identifying that Benbow contravened auditing independence standards by serving as the lead auditor for three consecutive half-year reviews of listed companies beyond the permitted five-year tenure.
ASIC Commissioner Kate O’Rourke stressed the crucial role of auditors in maintaining market integrity. This enforcement aligns with ASIC’s increased scrutiny on gatekeeper conduct announced for 2024.
“Independence is one of the cornerstones of the audit process,” O’Rourke said. “Specific audit rotation requirements were introduced 20 years ago to strengthen independence in listed company audits, and the requirements are well-known in the industry.”
See LinkedIn post here.
Paying the infringement notice does not imply guilt or liability on Benbow’s part but addresses ASIC’s concerns regarding audit rotation compliance.
Benbow proactively disclosed the breaches to ASIC, fulfilling his obligation under section 311 of the Corporations Act. According to Regulatory Guide 187 on Auditor Rotation, auditors are expected to inform ASIC of any personal violations of the Corporations Act, which includes failing to meet the five-year audit rotation rule for listed companies.
This latest news from ASIC follows the Federal Court’s dismissal of Provide Capital’s challenge against ASIC probe as well as the ASIC-initiated fraud case against Former Sydney financial adviser David Valvo, of Your Financial Freedom.
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