Date posted: 15/05/2024

Important steps for a sustainable future taken in Federal Budget

Australia’s peak accounting body Chartered Accountants Australia and New Zealand (CA ANZ) says several initiatives announced as part of last night’s Federal Budget are important steps in providing the sector the resourcing and focus it needs as we transition to a sustainable future.

“It’s pleasing to see in the detail of the Budget, the Australian Accounting Standards Board (AASB) and Auditing and Assurance Standards Board (AUASB) are finally getting appropriate resourcing to support the development of standards for climate-related disclosures and wider sustainability reporting,” said CA ANZ Chief Executive Ainslie van Onselen.

“This has been something our members, and the wider profession have been calling for although we await the finer details of where the additional people will be employed,” Ms van Onselen said.

“There is also an additional $10m over four years for ASIC to investigate and take enforcement action against market participants engaging in greenwashing and other sustainability-related financial misconduct.

“This is of significant interest to the profession and something we have identified as an emerging issue the Government needed to address.

New beneficial ownership transparency requirements

“CA ANZ also notes $41.7m over four years to the Treasury, ASIC and the Attorney-General’s Department to regulate and support new beneficial ownership transparency requirements for Australian companies and other entities.

“CA ANZ were key participants in industry wide consultation on this very issue in late 2022 and look forward to seeing more detail on these requirements and engaging with government as they are developed.

“We also note funding for the Australian Small Business and Family Enterprise Ombudsman to support small business to navigate business-to-business disputes through alternative dispute resolution.

“Last year, the Government undertook a review of the Payment Times Reporting Act, and the Budget includes $25m over four years for the Payment Times Reporting Regulator to implement the required reforms, increasing the Regulator’s resourcing and upgrade their technology.

“We recently provided feedback on legislative amendments arising from the review and specifically highlighted the need for Government to increase awareness of the regime with small business.

Increased ASIC staffing

“Following the release of the Budget last night, we commended the Government on its strengthening of ASIC with a significant increase in staffing, although we are keen to see the detail of where those people will be employed.

“At several appearances in front of Parliamentary Inquiries over the past 12 months, I’ve regularly stressed the importance of having a strong and well-funded independent regulator for the profession, outside our remit as a membership body.

“Twenty years on from the government announcing the shift from self-regulation to government-regulation of audit, its concerning that gaps and uncertainties remain over jurisdiction, powers and resourcing.

“As we said in our recently released Going Further roadmap, it’s vital that additional funding is focused sufficiently on audit and financial reporting regulation and standards, to provide the coverage needed for government to meet the regulatory mandate it has taken on with respect to these critical aspects of Australia’s capital markets and economy.

“In addition to increased funding, it’s also essential to provide clearer regulatory powers for ASIC on quality management at audit firms and relevant governance requirements, as the audit regulator and standards setters have called for in recent submissions to parliament.

“We must be mindful however, that an increase in funding for ASIC will likely be paid for via industry levies, business and professionals,” Ms van Onselen said.