Appendix A
SUBMISSIONS RECEIVED BY WORKING PARTY
Name of individual or organisation	Issues	Discussion Paper	Draft 
Report	
National Corporate Regulation Scheme agencies				
Australian Securities Commission (staff comments)	3	3		
Companies Auditors and Liquidators Disciplinary Board	3	3	3	
Other Government agencies				
Australasian Council of Auditors‑General		3		
Australian Financial Institutions Commission	3	3		
Insurance and Superannuation Commission	3	3	3	
Reserve Bank of Australia	3			
Trade Practices Commission		3		
Australian Capital Territory Treasury	3			
The Audit Office of New South Wales	3			
The Treasury (New South Wales)	3			
Office of Business Affairs
NT Attorney‑General’s Department	3	3		
Northern Territory Auditor‑General’s Office		3		
Queensland Audit Office	3	3		
Auditor‑General (Tasmania)	3			
Department of Treasury and Finance (Tasmania)	3		3	
Department of Finance (Victoria)	3			
Victorian Auditor‑General’s Office	3			
Corporate Affairs Branch
WA Ministry of Justice		3		
Office of the Auditor General (Western Australia)	3	3		
Treasury (Western Australia)	3			
Accounting Profession				
Association of Taxation and Management Accountants			3	
Auditing Standards Board	3			
Australian Society of CPAs and The Institute of Chartered Accountants in Australia	3	3	3	
The Institute of Chartered Accountants in Australia (ACT Office)	3			
Midwest Accountants Group		3		
National Institute of Accountants	3	3	3	
New Zealand Society of Accountants	3		3	
Practising Accountants Centre for Education Inc	3	3		
Other Professional and Business Organisations				
Australian Corporate Lawyers Association	3			
Australian Institute of Company Directors	3	3		
Australian Stock Exchange	3			
Group of 100	3	3	3	
Insolvency Practitioners Association of Australia	3		3	
Trustee Corporations Association of Australia		3	3	
Accounting Firms				
Asset Management Services		3*		
Bird Cameron Partners (Canberra)	3			
BMO Accountants Group		3		
Brown Burns & Co	3			
Bye, John W			3	
Byfields		3		
Alex Campbell & Co			3	
Campbell‑Smith & Associates		3*		
Geoff Coleman & Company Pty Ltd			3	
Collins Creek Consultants Pty Ltd	3			
Coopers & Lybrand	3	3	3	
Creagh, Chapman, Barker Pty Ltd		3		
Deloitte Touche Tohmatsu	3			
Edwards Irvine and Facius Pty Ltd		3*		
Ernst & Young			3	
Everall Merrett Mann Pty		3		
Fleay Gardiner & Associates		3*		
Fleming Partners			3	
Forsyths			3	
Geers & Pusey		3*		
Gillard Turner & O’Brien Pty Ltd		3*		
Hearne, G F O		3*		
Hennessy, Eris M	3			
Herries Davidson & Co		3		
Hollands & Partners		3		
Hudson & Co		3*		
R T Kidd & Associates		3*		
KPMG			3	
Ledger Rutledge & Wilkinson		3		
Lee, Timothy		3*		
Lillingston Milne		3*		
Lovetts			3	
Ludwig, Ross		3*		
McCleary, Brian			3	
McNeil, Marie		3*		
Marlow Bluhm		3		
Metcalf Spahn	3	3		
K J Meyer Pty Ltd		3*		
John W Muntz & Co		3*		
James Murphy & Co		3		
Nipper, M R		3	3	
Price Waterhouse	3	3		
Reid, Subra and Associates		3*		
E. Rochman & Co Pty Ltd			3	
Rodda, Graeme		3		
Rous & Gamble		3*		
Samuel, Martin & Rogerson	3			
Shedden & Green Partners			3	
Smith, Leslie M		3		
Southwell‑Keely Partners		3		
Taits	3			
Barry M Thompson & Co		3		
Vivian Coetsee & Associates		3*		
Walter and Turnbul			3	
Weston Woodley & Robertson			3	
Other				
Craswell, Prof. Allen			3	
Hancock, P J (plus P Robinson, J Kestel)		3		
Wilkin, John		3	3	
*	These submissions either are form letters (dealing with the issues of public interest, accountant’s skills and the registered company auditor designation) or incorporate material that has been taken from the form letter.

Appendix B
AUSTRALIAN ACCOUNTING BODIES
B01.	As noted in chapter 3, Australia’s accounting bodies have developed comprehensive requirements for entry to membership, the supervision of members and the disciplining of members which apply to all members of the bodies, including those who are RCAs. As many of these requirements exceed the legislative requirements and ASC procedures for the registration and supervision of company auditors, the Working Party believes that the following overview of the requirements of the accounting bodies will be of assistance to readers when they are considering the Working Party proposals.
MEMBERSHIP
ICAA and ASCPA
B02.	A prerequisite for membership of both the ICAA and the ASCPA is a university degree which has a major in accounting and which contains separate units in auditing, Australian taxation law and Australian business law. 
B03.	Before members of the ICAA or the ASCPA can provide public accounting services (including auditing), they are normally required to hold a public practice certificate issued by their respective professional body. In general terms the requirements for a certificate of public practice are:
(a)	completion of the PY Program of the ICAA or the CPA Program of the ASCPA;
(b)	completion of the public practice program offered by the ICAA or the ASCPA;
(c)	appropriate experience in public practice; 
(d)	completion of compulsory continuing professional education/ development;
(e)	agreement to participate in a quality review program; and
(f)	agreement to take compulsory professional indemnity insurance.
B04.	Members in public practice must comply with the Accounting Bodies Joint Code of Conduct.
ATMA
B05.	There are three membership levels within the ATMA:
(a)	Fellow (FTMA) — accountants who have fulfilled the requirements of ‘member’ status within the ATMA and have been qualified as an accountant for 10 years or more; or holders of post graduate qualifications leading to a masters degree with an accounting emphasis; or holders of post graduate diplomas with an accounting emphasis.
(b)	Member (MTMA) — accountants who have completed a degree with an accounting major from an Australian university or a former college of advanced education.
(c)	Associate (ATMA) — graduates with degrees in administration, banking and finance, law, local government or marketing; or accountants who have completed a TAFE diploma in accounting but do not hold a degree with an accounting major from an Australian university or former college of advanced education. Associates must complete a professional upgrade program at an Australian university within five years of joining the ATMA to advance to member status.
B06.	ATMA members in public practice are required to hold a Public Practice Certificate. Members entering public practice certificate are required to complete a Public Practice Program, at an Australian University, before a Public Practice Certificate will be issued, if they did not hold a Public Practice Certificate as at 30 September 1994.
B07.	Professional indemnity insurance will be compulsory from 1 July 1997, for holders of current Public Practice Certificates.
B08.	ATMA members are expected to conform with the accepted accounting standards issued by the accounting profession.
NIA
B09.	The minimum academic qualification for Associate status membership of the NIA is the successful completion of an Advanced Diploma in Business (Accounting) from a College of TAFE. The Advanced Diploma is a two year full time course which covers the full range of accounting requirements.
B10.	Historically, Member status of the NIA has been achieved in one of two ways. In the last two years, to qualify at Member status all Associates are required to either have successfully completed a Graduate Certificate in Professional Accounting from the University of New England, or hold an approved accounting degree. In addition, the applicant must demonstrate three years of work experience in an accounting or related field before Member status is obtained. Prior to the introduction of this requirement, an applicant for advancement to Member status had to demonstrate a minimum of five years work experience in an accounting or related field.
B11.	Only members who have reached Member status or above are eligible to apply for a public practice certificate.
SUPERVISION
ICAA and ASCPA
B12.	The ICAA and ASCPA have arrangements in place for the supervision of their members, including those who are RCAs. The accounting bodies require members holding public practice certificates to complete a minimum amount of continuing professional development (the ASCPA specifies 60 hours (structured) per triennium while the ICAA requires 40 hours each year (20 hours structured; 20 hours unstructured)). 
B13.	Quality review programs have also been implemented to ensure that members in public practice, including RCAs, undertake their work in accordance with professional requirements.
B14.	The ICAA and the ASCPA introduced their quality review programs in 1994, commencing with pilot reviews and the training and review of reviewers. Both bodies then commenced the process of selecting and reviewing members and practices chosen at random.
B15.	The reviews are conducted by trained reviewers who are principals in public practice, and have themselves been reviewed. All areas of the accounting practice are reviewed, with an emphasis on audit and accounting engagements.
B16.	Both accounting bodies select members for review on the basis of a number of factors, eg type, size and location of practice. The actual reviews undertaken are similar in that they review adherence to professional standards by practitioners in the course of providing service to their clients. Integral to the review process is an examination of the practitioner’s working papers. This last point is particularly sensitive as clients’ consent must be obtained before reviewers can examine the working papers.
B17.	The quality review programs of the accounting bodies have now been implemented on the basis of every public practice certificate holder being subject to review at least once in every five years. The emphasis of these programs in the first five year cycle is primarily educational.
ATMA
B18.	The ATMA requires its members to undertake a minimum of 20 hours continuing professional development in any one calendar year. Continuing professional development activities may be made up of structured and unstructured activities. The ATMA will be conducting, from 1 July 1997, random audits of CPD activities undertaken.
B19.	A Quality Assurance program for all ATMA members will be implemented from 1 July 1997 to ensure that members, particularly those in public practice, undertake their work in a professional manner.
NIA
B20.	The NIA has the following arrangements in place for the supervision of members:
(a)	There is a requirement for all members of the NIA to undertake Continuing Professional Education. For Fellows and Members in Public Practice, there is a requirement for a minimum of 60 hours CPE per biennium. Members who are not in Public Practice are required to complete 40 hours CPE per biennium.
(b)	The requirement for NIA members to conduct their professional endeavours in a suitable manner is supported by an identifiable and enforceable Code of Ethics which is based on international ethical standards. The Code of Ethics is based on the concept that members will act legally at all times.
(c)	NIA public practitioners are required to complete a Public Practice Orientation Program and must hold and maintain a Public Practice Certificate.
(d)	Public liability insurance is mandatory for all NIA public practice certificate holders.
(e)	NIA public practitioners must abide by strict guidelines on ‘conduct of members in public practice’ as well as the Code of Ethics.
(f)	NIA public practitioners must adhere to the ‘public practitioners manual’ which includes a section on quality assurance (QA). Members are expected to implement the QA processes as appropriate to their particular practice.
discipline
ICAA and ASCPA
B21.	Both the ASCPA and the ICAA have established disciplinary procedures for dealing with members who have breached their code of ethics or committed a range of other transgressions. For example, a member may be penalised where he or she has breached ethical pronouncements, engaged in conduct that is dishonourable, derogatory or not in the best interests of the profession or has failed to observe proper professional standards. Penalties that may be imposed include forfeiture of membership, suspension from membership, cancellation of a certificate of public practice, remedial professional development, censure and admonishment and/or a fine of up to $100,000 plus publication of the member’s name with a summary of the transgression.
B22.	The ASCPA and the ICAA have established similar institutional arrangements for handling disciplinary matters including the appointment of lay members to disciplinary committees. 
B23.	Complaints are typically considered by an investigation committee, which then advises a disciplinary committee whether, in its opinion, a member has a case to answer. Where there appears to be a case to answer, the disciplinary committee is required to conduct a hearing and, where it concludes that a complaint has been sustained, impose an appropriate penalty. The findings of the disciplinary committee may, in certain circumstances, be the subject of an appeal to an appeals committee. The investigation, disciplinary and appeals committees may include lay members.
ATMA
B24.	The ATMA has adopted the ethical pronouncements of the major accounting bodies. Non compliance with accounting and auditing standards and ethical pronouncements will result in disciplinary action being taken against the member and forfeiture of membership.
B25.	The ATMA has established disciplinary procedures for dealing with members who have breached its code of ethics or have transgressed the fundamental principles of professional conduct as described in the Members’ Handbook. Complaints are investigated by a subcommittee of the General Council and if there is a case to be answered, the General Council forms a disciplinary committee. The General Council shall have power by resolution to censure, fine or suspend a member or forfeit membership.
NIA
B26.	The NIA disciplinary system has three levels of operation: investigation, disciplinary and appeals. Although the Articles allow for this system to operate at a Divisional level, the current practice is for them to be handled at a National level. There are two national standing committees: the National Investigation Committee (ICN) and the National Disciplinary Committee (DCN). The Appeals Committee is brought into being on a ‘needs’ basis by National Council and normally comprises senior nominations with specialist knowledge/ experience in the area in which the breach has occurred.
B27.	Actions by the ICN must be initiated by a written complaint. The ICN has the responsibility of deciding whether a member has a ‘case to answer’ for a breach of the NIA’s Articles, By‑laws or Pronouncements. If a decision is made that there is a ‘case to answer’, the information is passed to the DCN for a decision on whether the complaint has been proven and for an appropriate disciplinary award to be made. After the DCN decision, the member has 30 days in which to lodge an appeal. If an appeal is not lodged, the National Council’s resolution on the DCN/Appeals decision is formalised by notification to the member, and if decided, by publication of the findings.
PROFESSIONAL STANDARDS
B28.	The Australian Accounting Research Foundation (AARF), which was established by the ICAA and the ASCPA and is jointly funded by those bodies, is responsible for the development of the auditing standards that company auditors, who are members of one or both of these bodies, are required by their professional ethics to use when they are undertaking an audit assignment. The Auditing Standards Board established as part of AARF is responsible for the day‑to‑day work on the development of auditing standards and audit practice statements. 

Appendix C
DISTRIBUTION OF AUDITORS
within each State and Territory
as at 2 April 1997
New South Wales
Region or area	Uniform Companies Acts (ie before 1.7.83)	Co‑operative scheme (ie 1.7.83 to 31.12.90)	National scheme (ie after 31.12.90)	Total — all schemes	
Sydney metro area	
Sydney CBD	574	239	108	921	
North Sydney	57	24	5	86	
Parramatta	71	31	10	112	
Other metro areas	1129	364	66	1559	
Total metro area	1831	658	189	2678	
Country areas	
Blue Mountains	19	2	1	22	
Gosford  Central Coast	47	12	2	61	
Newcastle and the Hunter	129	41	4	174	
North Coast	106	52	12	170	
New England	77	30	9	116	
Wollongong and the Illawarra and South Coasts	69	16	13	98	
Southern Highlands and Tablelands	55	10	2	67	
Other areas	143	44	14	201	
Total Country areas	645	207	57	909	
Norfolk Island	0	1	0	1	
Total RCAs in NSW	2476	866	246	3588	

Victoria
Region or area	Uniform Companies Acts (ie before 1.7.83)	Co‑operative scheme (ie 1.7.83 to 31.12.90)	National scheme (ie after 31.12.90)	Total — all schemes	
Melbourne metro area	
Melbourne CBD	229	137	54	420	
Balwyn	26	8	0	34	
Blackburn	24	8	1	33	
Camberwell	17	15	0	32	
Caulfield	23	6	0	29	
Essendon	18	5	0	23	
Frankston	23	3	1	27	
Hawthorn	36	21	6	63	
Melbourne (St Kilda Rd)	34	17	6	57	
Mount Waverley	26	6	0	32	
Sth Melbourne	25	16	2	43	
South Yarra	27	9	1	37	
Other metro areas	677	256	47	980	
Total metro area	1185	507	118	1810	
Country areas	
Ballarat	20	7	1	28	
Bendigo	13	6	0	19	
Geelong	32	13	4	49	
Shepparton	5	6	0	11	
Swan Hill	7	1	2	10	
Warrnambool	8	2	1	11	
Wodonga	9	2	1	12	
Other areas	170	63	3	236	
Total Country areas	264	100	12	376	
Total RCAs in Victoria	1449	607	130	2186	
Queensland
Region or area	Uniform Companies Acts (ie before 1.7.83)	Co‑operative scheme (ie 1.7.83 to 31.12.90)	National scheme (ie after 31.12.90)	Total — all schemes	
Brisbane metro area	
Brisbane CBD	152	70	21	243	
Other metro areas	242	81	11	334	
Total metro area	394	151	32	577	
Country areas	
Cairns	26	6	7	39	
Gold Coast	98	21	9	128	
Mackay	17	4	2	23	
Rockhampton	23	4	0	27	
Sunshine Coast	36	13	3	52	
Toowoomba 	36	7	0	43	
Townsville	14	4	1	19	
Other areas	116	25	4	145	
Total Country areas	366	84	26	476	
Total RCAs in
Queensland	760	235	58	1053	

Western Australia
Region or area	Uniform Companies Acts (ie before 1.7.83)	Co‑operative scheme (ie 1.7.83 to 31.12.90)	National scheme (ie after 31.12.90)	Total — all schemes	
Perth metro area	
Perth CBD	89	39	18	146	
South Perth	23	9	3	35	
Subiaco	32	6	3	41	
West Perth	84	38	9	131	
Other metro areas	223	51	23	297	
Total metro area	451	143	56	650	
Country areas	
Albany	4	2	0	6	
Bunbury	10	3	1	14	
Esperance	2	0	0	2	
Geraldton	6	1	0	7	
Kalgoorlie	3	1	0	4	
Other areas	24	5	3	32	
Total Country areas	49	12	4	65	
Total RCAs in WA	500	155	60	715	

South Australia
Region or area	Uniform Companies Acts (ie before 1.7.83)	Co‑operative scheme (ie 1.7.83 to 31.12.90)	National scheme (ie after 31.12.90)	Total — all schemes	
Adelaide metro area	
Adelaide CBD	125	25	12	162	
North Adelaide	20	1	3	24	
Wayville	28	7	5	40	
Unley	20	4	0	24	
Fullarton	19	10	0	29	
Kent Town	38	9	3	50	
Other metro areas	109	19	9	137	
Total metro area	359	75	32	466	
Country areas	
Mt Gambier	8	2	0	10	
Port Lincoln	2	0	0	2	
Port Pirie	3	0	0	3	
Renmark	2	0	0	2	
Whyalla	2	0	0	2	
Other areas	16	3	0	19	
Total Country areas	33	5	0	38	
Total RCAs in SA	392	80	32	504	

Tasmania
Region or area	Uniform Companies Acts (ie before 1.7.83)	Co‑operative scheme (ie 1.7.83 to 31.12.90)	National scheme (ie after 31.12.90)	Total — all schemes	
Hobart metro area	
Hobart CBD	38	10	8	56	
Bellerive	7	3	0	10	
Glenorchy	4	0	0	4	
Other metro areas	19	5	1	25	
Total metro area	68	18	9	95	
Country areas	
Burnie	10	2	0	12	
Devonport	11	1	0	12	
Launceston	26	8	4	38	
Other areas	14	4	0	18	
Total Country areas	61	15	4	80	
Total RCAs in Tasmania	129	33	13	175	

Australian Capital Territory
Region or area	Uniform Companies Acts (ie before 1.7.83)	Co‑operative scheme (ie 1.7.83 to 31.12.90)	National scheme (ie after 31.12.90)	Total — all schemes	
Canberra metro area	
Canberra CBD	19	7	8	34	
Other metro areas	37	13	3	43	
Total RCAs in ACT	56	20	11	87	
Northern Territory
Region or area	Uniform Companies Acts (ie before 1.7.83)	Co‑operative scheme (ie 1.7.83 to 31.12.90)	National scheme (ie after 31.12.90)	Total — all schemes	
Darwin metro area	
Darwin CBD	4	13	1	18	
Other metro areas	4	5	3	12	
Total metro area	8	18	4	30	
Other areas	
Alice Springs	0	6	1	7	
Nhulunbuy	2	0	0	2	
Total other areas	2	6	1	9	
Total RCAs in NT 	10	24	5	39	

Appendix D
APPLICATION FOR REGISTRATION AS AN AUDITOR
(Form 903A)

The following information must be disclosed in an application for registration as an auditor:
(1)	Name and residential address of applicant.
(2)	Date and place of birth of applicant.
(3)	Business occupation of applicant.
(4)	Whether applicant is a member of an accounting partnership.
(5)	The name under which the applicant proposes to practise as an auditor.
(6)	The address of the principal place at which the audit practice is or will be conducted.
(7)	Addresses of other places at which the audit practice is or will be conducted.
(8)	Name of the applicant’s employer.
(9)	Particulars of the applicant’s academic and professional qualifications.
(10)	Particulars of the applicant’s employment and business activities for the past ten years.
(11)	The names of registered company auditors under whose direction the applicant has worked.
(12)	Whether the applicant has ever been excluded from practice as an auditor or liquidator, had registration as an auditor suspended or been subject to disciplinary action by any body having authority in Australia or elsewhere for the registration or disciplining of auditors or liquidators.
(13)	Whether the applicant has ever been subject to a prohibition under section 229, a civil penalty disqualification, an order under section 230 or section 599 or a notice under section 600.
(14)	Whether the applicant has ever had a status equivalent to that of an insolvent under administration under the law of a country other than Australia or under the law of an external territory.

(15)	Whether the applicant has a conviction, in Australia or elsewhere, for an offence (other than a traffic offence).
(16)	Whether the applicant has any legal or disciplinary proceedings pending that may result in action that would require disclosure under any of the above items.

(17)	Whether, in the last five years, the applicant has resigned or been removed from office as an auditor or liquidator.
(18)	The names of at least two referees.
(19)	A form endorsed by the Australian Federal Police that the applicant is not adversely recorded.

Appendix E
TRIENNIAL STATEMENT OF AN AUDITOR
(Form 907)

The following information must be disclosed in a triennial statement prepared by or on behalf of a registered company auditor (RCA):
(1)	The period of time to which the statement relates.
(2)	Name and residential address of RCA.
(3)	Date and place of birth of RCA.
(4)	Business occupation of RCA.
(5)	Whether RCA is a member of an accounting partnership.
(6)	The name under which the RCA practises as an auditor.
(7)	The address of the principal place at which the audit practice is conducted.
(8)	Addresses of other places at which the audit practice is conducted.
(9)	Name of the RCA’s employer.
(10)	Whether the RCA is still practising as an auditor.
(11)	Whether the RCA is resident in Australia.
(12)	Whether there was any period during the three years preceding the date of the statement in which the RCA was not resident in Australia.
(13)	Whether the RCA has ever been excluded from practice as an auditor or liquidator, had registration as an auditor suspended or been subject to disciplinary action by any body having authority in Australia or elsewhere for the registration or disciplining of auditors or liquidators.
(14)	Whether the RCA has ever been subject to a prohibition under section 229, a civil penalty disqualification, an order under section 230 or section 599 or a notice under section 600.
(15)	Whether the RCA has ever had a status equivalent to that of an insolvent under administration under the law of a country other than Australia or under the law of an external territory.
(16)	Whether, during the three years preceding the date of the statement, the RCA has been convicted of an offence (other than a traffic offence).
(17)	Whether the RCA has any legal or disciplinary proceedings pending that may result in action that would require disclosure under any of the above items.

(18)	Whether, in the last three years, the applicant has resigned or been removed from office as an auditor or liquidator.

(19)	Details of a maximum of ten audits conducted by the RCA since the date of the last triennial statement or the date of the RCA’s registration, whichever is the later.

Appendix F
OTHER REPORTING REQUIREMENTS FOR AUDITORS

Particulars of cessation or change relating to a person registered as an auditor
(Form 905)
Subsection 1287(1) requires a registered company auditor to lodge the following information not later than 21 days after the date of the event that has to be reported:
(1)	Name and residential address of RCA.
(2)	The date on which the person ceased to practise as an auditor.
(3)	Details of any change to the person’s name.
(4)	Details of any change to the name or style under which the RCA practises as an auditor.
(5)	Details of any change to the address of the principal place at which the audit practice is conducted.
(6)	Details of any change to the addresses of other places at which the audit practice is conducted.
(7)	Details of any change of employment or to the name of the RCA’s employer.

Notification of a section 229 prohibition, a civil penalty disqualification, a section 230 order, a section 599 order or a section 600 notice
(Form 906)
Subsection 1287(4) requires a person who is registered as an auditor to lodge particulars in writing of the circumstances because of which he or she became subject to a section 229 prohibition, a section 230 order, a section 599 order, a section 600 notice or a civil penalty disqualification. The notification must set out the following information:
(1)	Name and residential address of RCA.
(2)	Date and place of birth of RCA.
(3)	Registration number of RCA.
(4)	Type of registration (liquidators may also be required to complete this form).
(5)	Particulars of the action affecting the auditor.