ADIs and ADI Groups
This Guidance Statement has been formulated by the Auditing and Assurance Standards Board (AUASB), in consultation with the Australian Prudential Regulation Authority (APRA), to provide guidance to the appointed auditor of an Authorised Deposit-taking Institution (ADI) and/or appointed auditor of a Level 2 and/or Level 3 ADI group, reporting pursuant to the prudential reporting requirements specified by APRA in Prudential Standards APS 310 Audit and Related Matters (July 2019) (APS 310), 3PS 310 Audit and Related Matters (July 2017) (3PS 310) and APS 910 Financial Claims Scheme (July 2013) (APS 910).
This Guidance Statement includes references to prudential reporting requirements for ADIs and ADI groups, and their appointed auditors, as specified by APRA. “Level 1”, “Level 2” and “Level 3”, as applied in this Guidance Statement, have the meaning given in APRA Prudential Standards APS 001 Definitions (APS 001) and 3PS 001 Definitions (3PS 001).
- In applying this Guidance Statement on a group basis, references to an ADI should be read as also referring to the head of a Level 2 or Level 3 group, as relevant. Where a Level 2 group operates within a Level 3 group, the head of the group is to be read as the head of the Level 3 group.
- The term “ADI group” in this Guidance Statement will mean a Level 2 or a Level 3 group, as relevant, and will be used where requirements and guidance are common for Level 2 and Level 3 groups.
This Guidance Statement provides guidance that may be considered and adapted as necessary in the circumstances, to assurance engagements undertaken pursuant to APRA Reporting Standard RRS 710.0 ABS/RBA Audit Requirements for Registered Financial Corporations – EFS collection (RRS 710.0), which applies to those Registered Financial Corporations (RFCs) required to report to APRA under the Economic and Financial Statistics (EFS) collection, from 1 July 2019.
APRA collects statistical data from RFCs under the Financial Sector (Collection of Data) Act 2001 (FSCODA). RFCs are not prudentially regulated or supervised by APRA under the Banking Act 1959 (Banking Act) and APRA’s Prudential Standards do not apply to RFCs. Investors in RFCs do not have the right to priority of repayment that is conferred on depositors by section 13A of the Banking Act. Further, RFC products are not covered by the Financial Claims Scheme, which applies only to deposits held in protected accounts of ADIs.
“ADI”, “appointed auditor”, “Level 1”, “Level 2” and “Level 3” are defined by APRA in Prudential Standards APS 001 and 3PS 001 Definitions. Refer to Attachment A to APS 001 for further explanation of the definition of Level 3 “conglomerate group” as it applies to ADIs.
Corporations required to be registered under Part 2 of the Financial Sector (Collection of Data) Act 2001 (FSCODA).
Not all RFCs are required to submit EFS data to APRA. EFS reporting requirements will depend on the size of the RFC and is specified by APRA in relevant EFS Reporting Standards.