New audit regime to boost confidence
A new audit licensing regime will help restore investor confidence in financial markets, Commerce Minister Simon Power says.
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A new audit licensing regime will help restore investor confidence in financial markets, Commerce Minister Simon Power says.
Parliament yesterday passed the Auditor Regulation and External Reporting Bill, which will now form two separate laws -- the Auditor Regulation Act and Financial Reporting Amendment Act.
"This bill is an important piece of the regulatory jigsaw to restore investor confidence in our financial markets, after the Registrar of Companies identified audit failure as a contributing factor in the collapse of finance companies," Mr Power said.
The Auditor Regulation Act will establish a new licensing regime for major audits of the likes of banks, insurance firms and NZX-listed companies. Small to medium-size companies and non-profits would not be affected.
The law also requires auditors to be licensed by the Institute of Chartered Accountants (NZICA) under the oversight of the new Financial Markets Authority (FMA).
The second new law, the Financial Reporting Amendment Act, consolidates the setting of accounting, auditing and financial reporting standards under a new body, the External Reporting Board (XRB).
The board's members will be drawn from the body it replaces, the Accounting Standards Review Board, and will be up and running from July 1.
The establishment of the XRB removes the statutory standard-setting responsibilities the NZICA, which previously set most standards.
NZPA
Thu, 12 May 2011
Thu, 12 May 2011
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New audit regime to boost confidence
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