COIDA: How to clear Compensation Fund audit

COIDA: How to clear Compensation Fund audit

• 13 December 2024
• Regulatory Compliance and Legislation
• South African Accounting Academy

Summary:

The Compensation Fund has issued a notice listing the prescribed supporting documents employers who have been flagged for an audit should produce to clear the audit.

Article:

This notice (which was gazetted on 25 November 2024) sets out the following required prescribed supporting documents to clear employers who are flagged or audit by the Compensation Fund:

1. EMP 501
2. A Detailed Payroll Report
3. An Audited / Independently Reviewed / Compiled Annual Financial Statement
4. An Affidavit explaining a reason for variance
5. Fully completed P\ROE Form (CF-2A / W.As.8)
6. Power of Attorney (Consultants, bookkeepers, accountants, auditors and attorneys)

An example has also been included for illustrative purposes.

Click here to download the 3-page Gazetted document:

https://www.gov.za/sites/default/files/gcis_document/202411/51555gon5585.pdf

Relevance to Auditors, Independent Reviewers & Accountants:

• COIDA is yet another piece of legislation that your clients must comply with, and which you must assess compliance with.  If they don’t comply with the relevant laws and regulations, you have certain reporting obligations in terms of NOCLAR (NOn-Compliance with Laws And Regulations) – this could include reporting to management, qualifying your audit opinion, reporting a Reportable Irregularity, etc.
• The responsibility to submit supporting documents to the Compensation Fund rests with the Employer (who is currently being audited).
• As an employer, you also need to comply with COIDA in your workplace.

Relevance to Your Clients:

• An entity (company or close corporation) has a duty to comply with the COID Act, and directors have to fulfil their duties accordingly, otherwise they could be held liable.
• The responsibility to submit supporting documents to the Compensation Fund rests with the Employer (who is currently being audited).

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