Insurance (prudential standard) determination No. 5 of 2014 - Prudential Standard GPS 310 - Audit and Related Matters
Non-routine reporting by Appointed AuditNon-routine reporting by Appointed Auditors
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Non-routine reporting by Appointed Auditors
- The Act specifies certain circumstances where Appointed Auditors are required to report to APRA on a non-routine basis.[13] This may be where:
(a) APRA requests specific information; or
(b) where an Appointed Auditor has information that is specified in the Act or that they consider would assist APRA in performing its functions.
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APRA may require an Appointed Auditor to provide information, or to produce books, accounts or documents, about an insurer if it will assist APRA in performing its functions under the Act.[14] To ensure that an Appointed Auditor is able to comply with any such request from APRA, the Appointed Auditor must retain all working papers and other documentation in relation to the insurer for a period of seven years after the date of the report or certificate to which the working papers or documentation relate, as required under the Corporations Act 2001.[15]
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In assessing whether the interests of policyholders may be materially prejudiced,[16] an Appointed Auditor must not consider a single activity or a single deficiency only in isolation. Policyholder interests may be materially prejudiced by a number of activities or deficiencies that may not individually result in a material threat to policyholder interests but, when considered in total, do amount to a material threat. In such cases, the Appointed Auditor must provide such information to APRA as required under the Act if they have reasonable grounds for believing that the interests of policyholders may be materially prejudiced.[17]
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In most cases, matters reported to APRA by an Appointed Auditor should also be reported by that person to the insurer to which the matter relates.[18] An Appointed Auditor must not notify the insurer where:
(a) that person considers that, by doing so, the interests of policyholders would be jeopardised; or
(b) there is a situation of mistrust between the Appointed Auditor and the Board or senior management of the insurer.
- An Appointed Auditor who is required to provide information to APRA on a non-routine basis[19] is not excused from such a requirement on the ground that doing so would tend to incriminate them or make them liable to a penalty.[20] Certain protection is provided under the Act[21] to Appointed Auditors who supply information to APRA in these circumstances.