.png)
An SMSF has invested in a nominee company who in turn used the funds to purchase shares in unlisted private companies in its name. None of the private companies recognise the SMSF as a shareholder. The nominee company issues a year end portfolio report on single sheet of paper to the SMSF listing all the companies and provides a market value for each company. No other documents are provided. They also refuse to supply financial statments for any of the underlying private companies. My conclusion was that it is a Part A qualification as there is no adequate or appropriate audit evidence but the accountant does not agee and is asking for the qualification to be removed. Am I missing anything?
top of page
THE AUDITORS INSTITUTE | FORUM
Archived Forums
When you become a member of The Auditors Institute, you immediately gain access to expertise, advocacy for your profession and peace of mind.
Ask a question in our members-only forum or use the search function to find prior technical discussions on your topic. You can expect a response within 24-48hrs.
Disclaimer
The forum is made available by The Auditors Institute Ltd for the benefit of it’s members only, and its primary purpose is to facilitate education, training, and discussion between members. The information and answers provided within the forum are of a general nature and do not consider any specific circumstances, objectives, financial situation or needs related to the matter/s raised. The responses should not be construed as financial advice, and each Member should seek their own professional advice before making any decisions. The Auditors Institute Ltd and its representatives are not responsible for any actions taken based on the information provided in the forum.
bottom of page
Hi Ron
I assume the nominee company that the Fund has invested in is not a related party & there are no in-house asset issues. I also assume that the Fund has invested in the nominee company you refer to and not directly in the private companies.
I agree that if you are unable to verify the value of the investment then yes you should issue a Part A qualification assuming it is a material investment.
The qualification could state:
Basis for Qualified Opinion
The Fund Trustee has invested in an unlisted investment which is disclosed in Note
X of the Notes to the Financial Statements. As this unlisted investments do no
prepare audited financial statements, I am unsure whether this investment is
recoverable, and whether an adjustment to the recorded market value should be
made. Hence, I provide no opinion on the market value of this investment as at
30 June 2022.
If other forum members have a view please let the forum know.
Thanks
SMSF AAA