New bill aims to increase relations between ASIC and foreign regulators

Chris Pearce

A bill that will allow the Australian Securities and Investments Commission (ASIC) to enter into a cooperative audit arrangement with the US Public Company Accounting Oversight Board (PCAOB) has been introduced into Federal Parliament.

The bill also extends the immunity against criminal liability to cover all financial reports that end on or before June 29, 2007.

The Australian Securities and Investments Commission (Audit Inspection) Bill 2006 was presented in Parliament by the Parliamentary Secretary to the Treasurer, Chris Pearce.

“The bill will provide a legislative framework to empower ASIC, with the consent of the Minister, to enter into cooperative audit arrangements with foreign regulatory bodies,” Pearce said.

According to Pearce, increased cooperation between Australian and US regulators is in the public interest, given the globalisation of capital markets and cross-border operations.

“Streamlining the information gathering process under a joint ASIC/PCAOB audit inspection will produce significant cost savings for Australian audit firms, as they will need to accommodate only one joint inspection, rather than two separate inspections by ASIC and the PCAOB,” Pearce said.

Pearce anticipates the new bill will enhance ASIC’s domestic and international audit inspection powers as well as reduce compliance costs and clarify uncertainty about the scope of ASIC’s existing powers to review audit firms.

“The Government has implemented several legislative and non-legislative safeguards to get the right balance between ASIC’s statutory responsibilities and protecting the interests of audit firms and their clients,” Pearce said.