Auditor requirements challenge regional Australia

New auditor registration arrangements are proving a real challenge for accounting practices in regional areas, according to Institute of Chartered Accountants self-managed superannuation fund (SMSF) specialist Liz Westover.

Westover said a recent tour of NSW regional areas had revealed that many auditors were older partners in regional accounting firms who were then faced with difficulties in adequately implementing succession planning.

"Not only can it be difficult to find audit staff, but it is becoming almost impossible for regional practitioners to satisfy the requirements to become Registered Company Auditors," she said. "Unfortunately, they will rarely be able to gain the required experience in large listed audits unless they have worked in larger, often city-based firms."

Westover said she was concerned that as the requirements for the registration of SMSF auditors were being finalised, a similar problem could be triggered.

"SMSFs continue to grow in number and they all require an annual audit," she said. "We need to be careful that the new provisions don't make it so prohibitive to become a registered SMSF auditor that it then becomes difficult for SMSF trustees to find a suitable auditor, particular in regional areas."

Westover said the objective of SMSF auditor registration was to ensure competent auditors carried out quality audits, but there was a need to be careful not to over-regulate to the point of stifling the industry.