The Fair Work (Registered Organisations) Act 2009 (the RO Act) specifies who is authorised to audit registered organisation or branch financial reports and what they must report.
On this page:
Auditors must be registered by the General Manager
Only auditors registered under the RO Act are authorised to audit registered organisations and branches.
Registration as a company auditor with the Australian Securities and Investment Commission (ASIC) doesn't entitle an auditor to audit a registered organisation. However, registered company auditors who apply for registration under the RO Act are subject to reduced assessment criteria.
Eligibility to hold the position of auditor
The position of auditor must be held by:
- an individual who is a registered auditor and who is not an 'excluded auditor' (see section 6 of the RO Act for a definition of 'excluded auditor')
- a firm with at least one member who is a registered auditor and where no members are an excluded auditor
- a company with at least one director, officer or employee who is a registered auditor and where there is no director, officer or employee who is an excluded auditor.
If an individual, firm or company doesn't meet these criteria they must resign from the position of auditor of any registered organisations or branches.
Apply for registration as an auditor
The General Manager must approve the registration of an auditor before they can accept appointment as an auditor of a registered organisation or branch.
Auditors who are already a registered company auditor under the Corporations Act 2001 can apply for registration by submitting an application for registration as a registered auditor by an individual who is a registered company auditor.
Auditors who are not a registered company auditor under the Corporations Act need to submit:
- an application for registration as a registered auditor by an individual who is not a registered company auditor
- Document A: Practical auditing and other equivalent experience
- Document B: Capability report
- Document C: Capability and supervisor declaration
- Document D: Auditor competencies logbook.
Submit completed forms to firstname.lastname@example.org.
Information about completing the forms is available in our guidance note Applying to become a registered auditor.
Cancellation or suspension of registration
Registered auditors can cancel or suspend their registration by lodging a cancellation or suspension of auditor registration form with the Commission.
If an auditor's registration is on the basis that they are a registered company auditor, and their registration as a company auditor is cancelled or suspended, the auditor must complete and lodge the same form.
Cancellation or suspension of registration by the General Manager
The General Manager may cancel or suspend an auditor's registration if the auditor:
- has failed to carry out their duties under the RO Act
- has not performed audit work during a period of at least 5 years and consequently does not have the requisite experience
- is otherwise not a fit and proper person to remain registered.
In the above instances, the General Manager must notify ASIC of any suspension or cancellation and the reasons.
The General Manager must inform the auditor of the decision to cancel or suspend their registration no later than 14 days after the decision has been made. The reasons for the decision must be provided.
Change in auditor's details
A registered auditor must advise the Commission of any changes in circumstances that could materially affect their registration within 14 days of the change. A failure to report changes in circumstances may result in the imposition of a civil penalty.
The audit report
In their report the auditor must state whether, in their opinion, the general purpose financial report (GPFR) is presented fairly in accordance with the following:
- the Australian Accounting Standards
- the General Manager's reporting guidelines
- any other requirements imposed by Part 3 of Chapter 8 of the RO Act.
If not of that opinion, they must say why and must, to the extent it is practicable, quantify the effect that non-compliance has on the GPFR.
The auditor must include a declaration that as part of the audit of the financial statements, they have concluded that the management’s use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
The auditor must ensure the report describes:
- any defect or irregularity in the GPFR
- any deficiency, failure or shortcoming in respect of the matters in section 257(2) or section 252 of the RO Act.
The auditor must also:
- ensure the form and content of the report complies with the Australian Auditing Standards
- date the report as the date they sign the report and give it to the reporting unit within a reasonable time of being given the GPFR.
Report a suspected breach
If an auditor suspects, on reasonable grounds, that there has been a breach of the RO Act or the General Manager's reporting guidelines they can:
- address this in their report or
- report the matter to the reporting unit's committee of management.
If the auditor thinks that the matter cannot be adequately dealt with in these ways, they must report the suspected breach, in writing, to the General Manager.
Powers and rights of auditors
The auditor is entitled:
- to full and free access to all records and other documents of the reporting unit relating directly or indirectly to the receipt or payment of money, or to the acquisition, receipt, custody or disposal of assets, by the reporting unit
- to seek from any designated officer, or employee of the reporting unit, such information and explanations as the auditor or authorised person wants for the purposes of the audit.
There are penalties for obstructing auditors.
Other rights of auditors
- must be forwarded notices relating to the meetings at which the report is presented
- has a right to attend and speak at the part of a meeting that concerns the report or their appointment
- enjoys qualified privilege against defamation
- must have their reasonable fees and expenses paid by the reporting unit
- can only be removed in accordance with section 263, which specifies decision making bodies and majorities.
Rotation of auditors
The RO Act limits the number of consecutive years that a registered auditor can audit the financial report of a reporting unit. For more information see Auditors and the audit report.