AAT upholds ASIC decision to disqualify SMSF auditor

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ASIC disqualification approved SMSF auditor, AAT upholds decisionThe Administrative Appeals Tribunal (AAT) has upheld a decision by ASIC to disqualify an approved SMSF auditor.

In October 2015 ASIC made an order disqualifying Abe Samuel from being an approved SMSF auditor. Mr Samuel requested that ASIC reconsider this decision. ASIC confirmed the decision in November 2015 and announced the disqualification in early December 2015. ASIC says it found that Mr Samuel had breached the APES 110 independence requirements by being a member of a fund he audited and the director of its corporate trustee. ASIC also found he held the power of attorney for, and was a relative of, a member of a fund he audited.

On 18 December 2015 Mr Samuel applied to the AAT for a review of the disqualification decision. ASIC’s decision was upheld by the AAT on 9 September 2016.

A statement by ASIC quotes the AAT as saying that Mr Samuel: “plainly breached the auditor independence requirements in APES 110 (Code of Ethics for Professional Accountants). As a consequence, he contravened his professional obligations under s128F of the Superannuation Industry (Supervision) Act 1993.”

He also: “failed to carry out or perform adequately and properly the duties of an auditor under the Act or the Regulations or as otherwise required by law; and, furthermore or alternatively, the Applicant (Mr Samuel) is not a fit and proper person to be an approved SMSF auditor for the purposes of the Act.”

The AAT said that ASIC’s decision was upheld due to “the very serious and fundamental nature of the applicant’s (Mr Samuel’s) deficiencies; his longstanding and ongoing failure to understand properly those deficiencies; and the clear need to uphold the integrity of the SMSF system”.

Following the AAT decision, ASIC Commissioner John Price said: “To safeguard the SMSF sector, ASIC will continue to use its power to disqualify approved SMSF auditors that don’t perform their role adequately and meet professional standards.”

ASIC says that SMSF trustees and members can check the registration status of the SMSF auditor, or if a person has been disqualified, on the ASIC SMSF auditor register.

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