Skip Ribbon Commands
Skip to main content

Super fund auditor removed

8 Jun 2006

The Australian Prudential Regulation Authority (APRA) today announced that it has accepted an Enforceable Undertaking under Section 262A of the Superannuation Industry (Supervision) Act 1993 (the SIS Act) from Mr Ian West, who was the auditor of the Western Truck Superannuation Fund from 1997 to 2003.
Under the terms of the Undertaking, Mr West is not to act as an auditor for an APRA-regulated superannuation fund at any time in the future. He has also agreed not to perform any audits of self-managed super funds (SMSFs) without successfully completing acceptable training. This requirement is subject to the acceptance of the Australian Taxation Office, which is the regulator of SMSFs.
Mr West had issued unqualified audit reports for the Western Truck Superannuation Fund for the financial years 2000/01, 2001/02 and 2002/03, when in fact the reports should have stated that the Fund was in breach of the in-house asset provisions of the SIS Act.
Mr West gave his unqualified opinions after erroneously accepting a declaration that the Fund was exempt from certain in-house asset provisions of the SIS Act, when in fact the Fund was not eligible to make that declaration. Mr West has accepted that his audit opinions were in error and has accepted responsibility for giving the unqualified opinions.
The in-house asset provisions of the SIS Act prohibit superannuation funds from investing more than five per cent of fund assets into an employer sponsor. This is to protect members from losing their superannuation as well as their jobs in the event that the employer sponsor fails. Whilst in this case the unqualified opinions did not result in any loss of member funds, APRA considers it essential that superannuation fund auditors understand relevant legislation when they are providing an opinion on compliance.
APRA Deputy Chairman, Mr Ross Jones, said that Enforceable Undertakings were in some cases an effective alternative to other enforcement actions, such as disqualification from practice.
"They provide a useful discipline on the parties and can, if necessary, be enforced by application to the Federal Court," he said.
A copy of the Enforceable Undertaking is on APRA's website. Click here for more information.
The Australian Prudential Regulation Authority (APRA) is the prudential regulator of the financial services industry. It oversees banks, credit unions, building societies, general insurance and reinsurance companies, life insurance, friendly societies, and most members of the superannuation industry. APRA is funded largely by the industries that it supervises. It was established on 1 July 1998. APRA currently supervises institutions holding approximately $2.2 trillion in assets for 20 million Australian depositors, policyholders and superannuation fund members.