Resignation and removal of auditors of retail CCIV financial reports and compliance plans

This is Information Sheet 289 (INFO 289). It is for auditors of retail corporate collective investment vehicles (retail CCIVs) financial reports and compliance plans who wish to resign. It is also for corporate directors that wish to remove an auditor from office under the Corporations Act 2001 (Corporations Act).

It explains:

When we will consent to an auditor’s resignation or removal
When our consent is not required
How and when to lodge an application
The procedure after you have applied for consent, for both a resignation and removal, and the requirement to notify ASIC of the change in auditor
Why applications are returned.

As retail CCIVs have no annual general meetings, appointments and removal of auditors of a retail CCIV’s financial reports and its compliance plans are managed by the corporate director. As such, corporate directors play an important role in ensuring auditor independence and audit quality.

Detailed guidance on how we apply the provisions of the Corporations Act relating to the resignation and removal of auditors of retail CCIV financial reports and compliance plans is contained in Regulatory Guide 26 Resignation, removal and replacement of auditors (RG 26), particularly RG 26.81–RG 26.90.

When we will consent to an auditor’s resignation or removal

An auditor of a retail CCIV financial report or compliance plan who wishes to resign, or a corporate director who wishes to remove an auditor from office, must apply to ASIC for our consent, using paper forms.

In general, we will consent to the resignation or removal of an auditor of a retail CCIV financial report or compliance plan, to take effect at any time of the year if:

our criteria for consent are satisfied (see RG 26.21), and
all relevant supporting information is provided with the application (see RG 26.84).

However, we will generally not consent to the resignation or removal of an auditor at any time of the year if:

concerns are raised by the outgoing auditor about a disagreement with management or directors, including management or directors of the corporate director (see RG 26.26–RG 26.31), and/or
other evidence indicates that we should not provide our consent, including the outgoing auditor being made aware that their resignation or removal may be connected with ‘opinion shopping’ (see RG 26.22–RG 26.25).

We will decide whether to consent to a resignation or removal on the merits of each application.

Effective date of resignation consent

If we consent to the resignation of an auditor of a retail CCIV financial report or compliance plan, the resignation will take effect on the later of (see RG 26.87):

the day of our consent
the day (if any) specified in the notice of resignation given by the auditor to the retail CCIV, or
a day that we specify (if any).

If we consent to the resignation of an auditor of a retail CCIV (and its compliance plan) that is a disclosing entity, then, depending on the circumstances, the corporate director may be required to lodge a continuous disclosure notice with ASIC or the relevant market operator containing:

details of the outgoing auditor
details of the proposed incoming auditor, and
the reason for the change in auditor (see RG 26.89).

If we consent to the resignation of an auditor of a retail CCIV (and its compliance plan) that is not a disclosing entity, or is a disclosing entity that does not need to lodge a continuous disclosure notice, ASIC considers it best practice to disclose the above auditor details at or around the date when the resignation takes effect, by public notice displayed prominently on the corporate director’s website where the notice can reasonably be readily located and accessed by members of the retail CCIV (see RG 26.90).

Effective date of removal consent

If we consent to the removal of an auditor of a retail CCIV financial report or compliance plan, our consent will take effect when all the conditions of ASIC’s consent have been met. These conditions include disclosures to the relevant market operator or members of the retail CCIV about the details of the outgoing auditor, proposed incoming auditor and the reason for the change of auditor (see RG 26.88).

When our consent is not required

If a retail CCIV’s compliance plan auditor has become ineligible to act under section 1226F(3), the corporate director must remove the auditor: see section 1226J(1)(a). Our consent is not required in this case. The corporate director must notify ASIC of this removal using Form 5214 Notification of request by corporate director to change compliance plan auditor of a corporate collective investment vehicle.

If a retail CCIV’s financial report auditor has become ineligible to act under Part 2M.4 Divisions 2 or 3 (as modified by Part 8B.4 Division 4), the auditor ceases to hold office: see section 331AAA(2) (as modified by s1232R(2)). The auditor will also cease to hold office if the retail CCIV (in respect of all its sub-funds) is to be wound up: see section 331AD (as modified by section 1232R(2)). The corporate director must notify ASIC of the cessation using Form 5233 Notification of resignation, removal, or cessation of auditor of a CCIV.

How and when to lodge an application

An application may be lodged, using the required form, at any time of the year subject to the requirements in:

Form 5212 Application for consent from ASIC to remove compliance plan auditor of a corporate collective investment vehicle
Form 5213 Application for consent from ASIC to resign as compliance plan auditor of a corporate collective investment vehicle
Form 5232 Application for consent from ASIC for resignation or removal of auditor for corporate collective investment vehicle

An auditor continues to hold office until our consent has been granted and it ends in accordance with the terms of our consent. For this reason, our consent should not be assumed, and auditor arrangements should not be changed before our consent is received.

We do not have the power to allow a resignation to take effect before the date on which we give consent, nor can we backdate our consent. You should lodge your application within a reasonable time so we can give due consideration to the information provided and arrive at a decision.

Generally, a reasonable time is at least four weeks before the intended date of change.

The procedure after you have applied for consent

Resignations

When an auditor applies to ASIC for consent to resign, the auditor must advise the corporate director in writing that an application is being made: see section 331AC(2)(a)(ii) (as modified by section 1232R(2)) and section 1226J(3)(a)(ii).

After a decision has been reached, we will advise both the auditor and the corporate director in writing.

If we grant our consent to the resignation, the auditor must give written notice of their resignation to the corporate director. This notice cannot be given until after our consent has been received.

Removals

If we grant consent, we will advise the corporate director in writing. The corporate director should then give written notice of our decision to the auditor, but only after the corporate director has received notification of our decision.

Notification of auditor change

Within 14 days after receiving a notice of resignation from the auditor of the CCIV or after the removal of the auditor, a corporate director must lodge Form 5233 Notification of resignation, removal, or cessation of auditor of a CCIV (section 331AC(7) (as modified by section 1232R(2)).

The corporate director must appoint an auditor to fill the vacancy no later than one month after the resignation or removal: see section 331AAB(1) (as modified by section1232R(2)). Within 14 days of the appointment of a replacement auditor, a corporate director must lodge Form 5230 Notification of appointment of auditor for a corporate collective investment vehicle (notional section 1232R(3) as inserted by ASIC Corporations (CCIV Auditors) Instrument 2024/668).

If the compliance plan auditor of a retail CCIV has changed, within seven days, the corporate director must lodge Form 5214 Notification of request by corporate director to change compliance plan auditor of a corporate collective investment vehicle: see section 1226K.

Why applications are returned

Our experience is that some auditors lodge applications that are either incomplete or based on one or more misconceptions about what the Corporations Act requires.

Applications that do not sufficiently address the matters referred to in RG 26, or that are incomplete or deficient, will not be assessed by us until all relevant information is provided. In this case, we may either return the application to you with an ‘Intent to refuse’ letter, or email you seeking correction of the deficiencies and ask for further information to support the application. See the checklist of information to be provided with your application in the appendix to RG 26.

Where can I get more information?

RG 26 Resignation, removal and replacement of auditors
Contact us.

Important notice

Please note that this information sheet is a summary giving you basic information about a particular topic. It does not cover the whole of the relevant law regarding that topic, and it is not a substitute for professional advice. We encourage you to seek your own professional advice to find out how the applicable laws apply to you, as it is your responsibility to determine your obligations.

You should also note that because this information sheet avoids legal language wherever possible, it might include some generalisations about the application of the law. Some provisions of the law referred to have exceptions or important qualifications. In most cases your particular circumstances must be taken into account when determining how the law applies to you.

Information sheets provide concise guidance on a specific process or compliance issue or an overview of detailed guidance.

This information sheet was issued in October 2024.