Corporations Act 2001

CHAPTER 2M - FINANCIAL REPORTS, SUSTAINABILITY REPORTS AND AUDIT  

PART 2M.3 - FINANCIAL AND SUSTAINABILITY REPORTING  

Division 3 - Audits and auditor ' s reports  

Note: This Division applies to sub-funds of retail CCIVs in a modified form: see section 1232G .

SECTION 307B   WORKING PAPERS FOR AUDIT OF FINANCIAL OR SUSTAINABILITY REPORT TO BE RETAINED FOR 7 YEARS  

Contravention by individual auditor or audit company

307B(1)    
An auditor contravenes this subsection if:

(a)    the auditor is an individual auditor or an audit company; and

(b)    

the auditor conducts:

(i) an audit or review of the financial report for a financial year; or

(ii) an audit or review of the financial report for a half-year; or

(iii) an audit of the sustainability report for the financial year; and

(c)    

the auditor does not retain all audit working papers prepared by or for, or considered or used by, the auditor in accordance with the requirements of the auditing standards until:

(i) the end of 7 years after the date of the auditor ' s report prepared in relation to the audit or review to which the audit working papers relate; or

(ii) an earlier date determined for the audit working papers by ASIC under subsection (6) .

307B(2)    
An offence based on subsection (1) is an offence of strict liability.

Note: For strict liability see section 6.1 of the Criminal Code .

Contravention by member of audit firm

307B(3)    
A person (the defendant ) contravenes this subsection if:

(a)    

an audit firm conducts:

(i) an audit or review of the financial report for a financial year; or

(ii) an audit or review of the financial report for a half-year; or

(iii) an audit of the sustainability report for the financial year; and

(b)    

the audit firm fails, at a particular time, to retain all audit working papers prepared by or for, or considered or used by, the audit firm in accordance with the requirements of the auditing standards until:

(i) the end of 7 years after the date of the auditor ' s report prepared in relation to the audit or review to which the documents relate; or

(ii) the earlier date determined by ASIC for the audit working papers under subsection (6) ; and

(c)    the defendant is a member of the firm at that time.

307B(4)    
An offence based on subsection (3) is an offence of strict liability.

Note 1: For strict liability see section 6.1 of the Criminal Code .

Note 2: Subsection (5) provides a defence.

307B(5)    
A member of an audit firm does not commit an offence at a particular time because of a contravention of subsection (3) if the member either:

(a)    does not know at that time of the circumstances that constitute the contravention of subsection (3) ; or

(b)    knows of those circumstances at that time but takes all reasonable steps to correct the contravention as soon as possible after the member becomes aware of those circumstances.

Note: A defendant bears an evidential burden in relation to the matters in this subsection, see subsection 13.3(3) of the Criminal Code .

Earlier retention date for audit working papers

307B(6)    
ASIC may, on application by a person, determine, in writing, an earlier date for the audit working papers for the purposes of paragraphs (1)(c) and (3)(b) if:

(a)    the auditor is an individual auditor and the auditor:

(i) dies; or

(ii) ceases to be a registered company auditor; or

(b)    the auditor is an audit firm and the firm is dissolved (otherwise than simply as part of a reconstitution of the firm because of the death, retirement or withdrawal of a member or members or because of the admission of a new member or members); or

(c)    the auditor is an audit company and the company:

(i) is wound up; or

(ii) ceases to be an authorised audit company.

307B(7)    
In deciding whether to make a determination under subsection (6) , ASIC must have regard to:

(a)    whether ASIC is inquiring into or investigating any matters in respect of:

(i) the auditor; or

(ii) the audited body for the audit to which the documents relate; and

(b)    whether the professional accounting bodies have any investigations or disciplinary action pending in relation to the auditor; and

(c)    whether civil or criminal proceedings in relation to:

(i) the conduct of the audit; or

(ii) the contents of the financial report to which the audit working papers relate;

have been, or are about to be, commenced; and

(d)    any other relevant matter.

Audit working papers kept in electronic form

307B(8)    
For the purposes of this section, if audit working papers are in electronic form they are taken to be retained only if they are convertible into hard copy.