Bill to improve accounting and audit industries passes third reading

The Accounting Infrastructure Reform Bill, which passed its third reading in Parliament today, will improve the efficiency and effectiveness of the accounting and audit industries, Commerce and Consumer Affairs Minister Paul Goldsmith says.

Mr Goldsmith says the Bill is part of a package of improvements made as part of the Government’s Business Growth Agenda including the Financial Markets Conduct Act 2013 and the Financial Reporting Act 2013.

“The Accounting Infrastructure Reform Bill supports a key plank of the Business Growth Agenda – helping develop New Zealand’s capital markets,” says Mr Goldsmith

“The Bill realigns the structure of the audit and accounting industry so that participants are able to quickly adapt in changing environments.

“A more competitive and efficient accounting market will ensure better business advice for New Zealand firms, while a robust audit industry provides improved assurance for users of financial statements, building confidence in our financial markets.

An important effect of the Bill is to enable the New Zealand Institute of Chartered Accountants to form a new trans-Tasman professional body with Australian chartered accountants. Members of the Institute voted in favour of this move in 2013. Other key amendments the Bill makes include:

• Amending the rules on who may perform statutory audits so more people who are competent to perform audits do so.
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• Replacing legislative references to a chartered accountant with reference to a qualified statutory accountant so more people who are competent to perform these functions do so.
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• Reducing restrictions on legal form for audit firms while maintaining the quality of audits through standards and checks.
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• Introducing a requirement for independent assurance of financial statements for medium-sized and large charities.
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• Strengthening the regime that approves overseas audit associations and individuals to perform audits in New Zealand, to ensure that overseas auditors meet high standards equivalent to those met by auditors based in New Zealand.

“This Bill will make a real difference to accounting firms and benefit business by giving them more choice, and the confidence that high standards are being applied to services across the accounting sector,” Mr Goldsmith says.

“It also means charitable donors and the public will have increased transparency about larger charities’ finances.

“I am pleased that the House was able to pass this Bill with such wide support.”

The NZICA changes in the Bill will come into force before the end of the year. The other changes will come into force in 2015.

ENDS

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