Terms of Reference

An Advisory Group will be established with the purpose of advising the Australian and New Zealand accounting, auditing and assurance standards and oversight bodies on strategies to:

  • Establish a single set of trans-Tasman accounting standards within the broader context of both jurisdictions’ objective of adopting international accounting standards;
  • Ensure that Australian and New Zealand audit and assurance standards, and auditor regulation and institutional arrangements, do not form an impediment to trans-Tasman business activity;
  • Maximise the influence of Australia and New Zealand in the development of international accounting standards and international auditing and assurance standards, including the international standard setting process.

The Advisory Group will also help formulate advice to the two governments on these issues.

In undertaking this role, the Advisory Group will be guided by the fundamental principle contained in the Australia/New Zealand Memorandum of Understanding on Business Law Co-ordination that entities should only have to comply with one set of rules and have certainty as to the application of those rules in the other jurisdiction. It will also be guided by the principles attached to these terms of reference.

The Advisory Group will provide advice under three broad headings:

  • Standards setting – this will be advice primarily to the Financial Reporting Council (FRC) and the Accounting Standards Review Board (ASRB) in relation to accounting standards, and the FRC and the Professional Practices Board (PPB) of the New Zealand Institute of Chartered Accountants (NZICA) in relation to auditing and assurance standards. It will include advice on:
    • mechanisms to improve information exchange between Australian and New Zealand bodies;
    • how greater co-ordination can be achieved in domestic standard setting processes;
    • how cross-appointments between the standard setters could be progressed; and
    • the co-ordination of positions and strategies in relation to specific international standards and the international standards setting processes and arrangements.
  • Policy co-ordination – this will be advice primarily to the Australian and New Zealand governments. It will include advice on:
    • the broader policy and legal framework for accounting standards, auditing and assurance standards and regulation with a view to ensuring that, where appropriate, a consistent approach is taken to the application, monitoring and enforcement of such standards.
  • Joint institutions – this will be advice primarily to the Australian and New Zealand governments. It will include advice on:
    • the specific institutional arrangements that might be established over time to ensure that the objective of a single set of trans-Tasman accounting standards is achieved and maintained effectively and efficiently.
    • the specific institutional arrangements that might be established over time to ensure that Australian and New Zealand audit and assurance standards, and auditor regulation and institutional arrangements, do not form an impediment to trans-Tasman business activity.

The Advisory Group will comprise four nominees of the FRC, one nominee of the Australian Accounting Standards Board, one nominee of the Australian Auditing and Assurance Standards Board, four nominees of the ASRB, and one representative of each of the Australian Treasury and the New Zealand Ministry of Economic Development.

Meetings of the Advisory Group will be scheduled by the members as required. It is anticipated that this will entail at least two meetings per year, at least one of which will be held in New Zealand. The costs of participation in the Advisory Group will be met by the member organisations.

The Advisory Group may prepare and release discussion documents in the course of developing its advice.