NEW ZEALAND GAZETTE, No. 44

19 APRIL 2012

United Kingdom

(b) The auditor must:

(i) be a responsible individual;

(ii) be a member of a United Kingdom professional accounting body;

(iii) be a partner or employee of a firm registered with the Professional Oversight Board of the United Kingdom;

(iv) provide evidence of continuing experience since becoming a responsible individual;

(v) have completed at least 375 hours of experience on issuer audits or audits of overseas issuers; and

(vi) have completed a training course approved by FMA which provides the responsible individual with a reasonable knowledge of New Zealand laws relevant to commercial law and taxation; or

United States

(c) The auditor must:

(i) be registered as a CPA;

(ii) be a member of the American Institute of Certified Public Accountants; and

(iii) be a partner or employee of a firm registered with the PCAOB;

(iv) provide evidence of the academic and professional training completed by the applicant in order to be registered as a CPA;

(v) have completed:

(A) 3,000 hours of auditing experience within the five years before becoming a CPA; or

(B) complied with any experience requirements set by the American Institute of Certified Public Accountants;

(vi) provide evidence of continuing experience since becoming a CPA;

(vii) have completed at least 375 hours of experience on issuer audits or audits of overseas issuers; and

(viii) have completed a training course approved by FMA which provides the CPA with a reasonable knowledge of New Zealand laws relevant to commercial law and taxation.

5. Conditions to which licences must be subject—For the purposes of section 32(1)(b)(i) of the Act, every auditor licence must be subject to conditions of the following kinds:

(a) Conditions requiring licensed auditors to comply with any relevant rules and codes;

(b) conditions which ensure the licensed auditor does not accept issuer audit engagements (other than through a registered audit firm of which they are a partner or employee) unless the licensed auditor has:

(i) systems, policies and procedures that are equivalent to those required of a registered audit firm under clause 8(1)(d); and

(ii) professional indemnity insurance that is adequate and appropriate for the nature and scale of the licensed auditor’s business activities; and

(c) conditions requiring licensed auditors to provide specified reports and notifications to the relevant authority.

6. Conditions to which licences may be subject—For the purposes of section 32(1)(b)(ii) of the Act, auditor licences may be subject to conditions of the following kinds:

(a) Conditions restricting, or providing a mechanism for restricting or supervising, the issuer audits a licensed auditor can undertake;

(b) conditions regulating the workload taken on by a licensed auditor; and

(c) conditions allowing the relevant authority to monitor a licensed auditor’s workload and/or monitor a licensed auditor’s compliance with any conditions regulating the licensed auditor’s workload.

7. Prescribed requirements for ongoing competence—(1) Persons licensed by an accredited body under section 11 of the Act shall be subject to the following ongoing competence requirements prescribed for the purposes of section 32(1)(c) of the Act:

(a) Licensed auditors must complete at least 120 hours of training and education in every rolling three-year period, with such training or education to include at least 20 hours completed in every year (together, the required training);

(b) at least 50% of the required training must be structured training;

(c) of the structured training, at least 30% must relate to auditing and at least 30% must relate to financial reporting; and

(d) all required training must be relevant to the auditor’s professional activities.

(2) Required training must not include research or training which is required as part of conducting any particular audit or assurance engagement.

8. Prescribed minimum standards for registration as a registered audit firm—For the purposes of sections 25(1)(b) and 26(1)(d) of the Act, the following minimum standards are prescribed under section 32(1)(d) of the Act in respect of each audit firm that applies for registration:

(a) At least 75% of all partners of an audit firm must be members of an appropriate professional body;

(b) 50% of all partners of an audit firm must be members of an approved professional accounting body and hold a practising certificate issued by that professional accounting body;

(c) all partners of an audit firm must be fit and proper persons, as assessed by the relevant authority;

(d) the audit firm must have systems, policies and processes which:

(i) comply with the requirements of PES1, PES2 and PES3; or

(ii) in the case of an overseas audit firm:

(A) materially comply with the requirements of PES1, PES2 and PES3; and

(B) comply with the requirements of the corresponding standards applicable in the audit firm’s home jurisdiction;