Under section 331AAA, the scheme’s responsible entity is responsible for the appointment of the scheme’s financial report auditor. This is also the case for the scheme’s compliance plan auditor who is appointed by the responsible entity under section 601HG. It is therefore essential that the auditors and the scheme’s responsible entity separately agree on the terms of the respective audit engagements, which are to be recorded in writing. Such terms are normally outlined in separate audit engagement letters^[5] which are forwarded to the responsible entity.

The auditors may use the engagement letters to clarify the respective roles of the responsible entity’s directors, the financial report auditor and the compliance plan auditor, by contrasting the respective statutory responsibilities of the responsible entity and the auditors under the Act. Both the financial report auditor and compliance plan auditor obtain acknowledgment of management’s responsibilities from the directors of the scheme’s responsible entity when obtaining agreement on the terms of the audit engagements.