Section 15 Retirement Fund AUP Engagements

01 July 2022
Accounting
South African Accounting Academy

Registered auditors are advised to take note of this communication document.

On 14 April 2022, the Authority published FSCA Communication 12 of 2022 and FSCA RF Notice 5 of 2022. The exemption exempted funds from using certain formats (as prescribed under paragraph 3(2)(a), (b) and (c) of Board Notice 77, as published in Government Gazette 37844 of 18 July 2014) when preparing financial statements, on the condition that such funds use the Revised Illustrative Section 15 Retirement Fund Agreed-upon Procedures Reports (“the revised report formats”), as approved by the Independent Regulatory Board for Auditors (“IRBA”).

The IRBA effective date for the use of the revised report formats applies to all ‘Agreed-Upon Procedures’ engagement letters signed on or after 1 January 2022.

In terms of FSCA RF Notice 5 of 2022, the Authority’s exemption applies to all financial year ends beginning after 1 January 2022.

These dates remain unchanged.

With regard to previous formats:

It came to the Authority’s attention that some funds with financial year ends ending in the first three months of 2022 (up to and including 31 March 2022) have completed most of their preparations for the Agreed-Upon Procedures engagement by the time the Authority’s issued the exemption on 14 April 2022. This led to a significant number of queries from these fund as to whether these preparations will be accepted by the Authority. The Authority will allow deviations from the specified sample selection criteria, but still expect compliance with the International Standard on Related Services (ISRS) 4400 (Revised), Agreed-Upon Procedures Engagements, for example: agree the sample with the board of fund.

This is not a general extension and funds must still apply online on a case-by-case basis, using the Authority’s online submissions portal referencing this Communication.

Click here to download the FSCA Communication 14 of 2022:

https://www.fsca.co.za/Regulatory%20Frameworks/Temp/FSCA%20Communication%2014%20of%202022%20(RF).pdf https://www.fsca.co.za/Regulatory Frameworks/Pages/Industry-Communication.aspx

Relevance to Auditors, Independent Reviewers & Accountants:

When performing AUP engagements for Retirement Funds, auditors must ensure that the correct formats are used for reporting purposes, while adhering to the Revised ISRS4400
As an auditor, you need to evaluate whether the correct prescribed formats were used to prepare financial statements under Section 15 of the Pension Funds Act, 1956.

Relevance to Your clients:

Retirement Funds must ensure that the correct formats are used for reporting purposes.

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