Accounting reforms in 2014 and 2015

The Auditor Regulation Amendment Act 2014, the Financial Reporting Amendment Act 2014, the New Zealand Institute of Chartered Accountants Amendment Act 2014 and the Charities Amendment Act 2014 all received the Royal Assent on 6 November 2014.

Collectively, the four amendment Acts are improving the efficiency and effectiveness of the accounting and audit markets.

Charities Amendment Act 2014 improves charities assurance

The Charities Amendment Act will require registered charities with annual operating expenditure of $500,000 or more to have the financial statements they file with their annual returns be assured by a qualified accountant.

The Charities Amendment Act came into force on 1 April 2015.

The New Zealand Institute of Chartered Accountants Amendment Act allows the New Zealand Institute of Chartered Accountants more flexibility in how to structure itself

The New Zealand Institute of Chartered Accountants Amendment Act enabled the Institute to merge with its Australian counterpart, the Institute of Chartered Accountants Australia to form a new trans-Tasman institute called ‘Chartered Accountants Australia and New Zealand’.

Most of the New Zealand Institute of Chartered Accountants Amendment Act came into force on 15 December 2014. Chartered Accountants Australia and New Zealand formally came into existence on 1 January 2015. Sections 8(2), 11 and 13 of the New Zealand Institute of Chartered Accountants Amendment Act will come into force on 1 July 2015.

Financial Reporting Amendment Act 2014 allows more people who are competent to perform statutory audits to do so

The Financial Reporting Amendment Act allows members of accredited professional bodies to be allowed to perform most statutory audits if they are recognised by their professional body as qualified to do so.

The Financial Reporting Amendment Act came into force on 1 July 2015.

Auditor Regulation Amendment Act 2014 reduces restrictions on legal form for audit firms

The Auditor Regulation Amendment Act will remove the ban on companies performing statutory audits by allowing New Zealand audit firms to incorporate using the company form. It will also allow certain incorporated overseas audit firms to operate in New Zealand. Standards relating to ownership, governance and professional indemnity insurance will be set in regulations.

The Auditor Regulation Amendment Act came into force on 1 July 2015.