2 Jul 2012

Auditors to come under greater regulatory scrutiny

7:08 am on 2 July 2012

Auditors are the latest financial market players to come under greater regulatory scrutiny.

The Auditor Regulation Act came into force on Sunday and requires all auditors to be licensed and all audit firms to be registered.

The new regime only affects major audits - like those of banks, insurance companies and listed companies - and doesn't affect audits of small and medium sized companies and not-for-profit organisations.

The New Zealand Institute of Chartered Accountants is the licensing body and takes responsibility for the regulation of its members.

The institute's regulation general manager Richard Moon says the act is the most significant change to audit regulation in recent memory, and adds to other moves to build confidence in the financial sector.

He says the recent regulatory reforms have been comprehensive - there's a Financial Markets Conduct Bill before the house now and there has been financial reform in the areas of financial advisors, trustees, supervisors and auditors.