The term “responsible individual” is defined in the Auditors Oversight Law ("AOL") as:

"an individual, designated by a recognized auditor and who is the holder of a valid licence issued under section 11 or 12 of the Regulatory Law, who is responsible for audit work on a recognized auditor's behalf in relation to market traded, designated or Authority specified companies and who is permitted to sign audit reports for the recognized auditor".

The Regulatory Law is the Accountants Act (2020 Revision) (the "PAL") a copy of which can be found here [PAL].

Responsible individuals are subject to the AOL and the Rules.

Details of responsible individuals are entered on the Register which can be found here: [Register].

A person may only be designated as a responsible individual if they:

• hold a valid licence issued under the PAL;
• have confirmed to the Authority and the recognized auditor that they agree to abide by the Rules;
• have been designated by the auditor as competent to audit the financial statements of a market traded company;
• are permitted to sign audit reports for the recognized auditor; and
• are not currently prohibited from being a responsible individual by virtue of a disciplinary action.

Under the Rules:

• each recognized auditor is required to secure and retain on behalf of the AOA a written agreement and consent (in the prescribed form) from each of its responsible individuals agreeing that certain personal information can be collected and/or accessed, and in certain circumstances shared with others, by the AOA in the conduct of its work;
• responsible individuals are required to cooperate with the AOA in the conduct of its work and comply with Authority demands and request made under the Rules;
• only a responsible individual can sign an audit report on the financial statements of a market traded or designated company, or Authority specified company with respect to which the auditor is registered with the AOA;
• when conducting audit work, responsible individuals must:
  • comply with the auditing standards referred to in the firm`s audit report and any related quality control standards;
  • comply with the ethics and independence standards established by the Cayman Islands Institute of Professional Accountants and by the relevant professional accountancy body;

• responsible individuals are subject to the AOA's disciplinary procedures and sanctions; and

• responsible individuals can avail themselves of the AOA's appeals procedures.

Some of the obligations of registered audit firms relate to responsible individuals; details can be found here [Obligations of Registered Auditors].