International Law

The Australian Prudential Regulation Authority (APRA) has released a revised prudential standard on audit requirements for authorised deposit-taking institutions (ADIs).

The aim of revised Prudential Standard APS 310 Audit and Related Matters is to ensure that APRA is provided with independent advice from an ADI's auditor in relation to its operations and risk control environment, as well as assurance that data provided to APRA are reliable.

Key requirements of the prudential standard include:

• ADIs must formally appoint an auditor for prudential purposes (which can be the same as the auditor employed for financial statement audits);
• the appointed auditor must meet APRA's fit and proper and independence requirements;
• the level of assurance required from the audit is dependent upon the nature and source of data collections being audited; and 
• ADIs will continue to provide a risk management declaration endorsed by the Board of the ADI and the Chief Executive Officer.

The prudential standards will take effect for financial years beginning on or after 1 January 2009.