The Auditors Oversight Law, 2011 ("AOL") established the AOA and the scope of its operations. The Auditors Oversight (Amendment) Law, 2016 was gazetted on 5 December 2016, making some changes to the AOL. A pdf version of the The Auditors Oversight (Amendment) Law, 2016 can be downloaded from the link below:
The more significant changes are:
1. Creation of two new categories of audits falling under the AOA’s oversight:
i. “Designated company”: the change allows the AOA to designate in Regulations other entities which will be mandatorily in scope of its oversight as well as the present “market traded company(s)”, as defined. The purpose is to allow other entities to be brought quickly into scope without the delay of changing the AOL in response to Cayman Islands public policy decisions or changes in circumstances relating to overseas laws and regulations having a bearing on Cayman based entities/audits.
ii. “Authority specified company”: the change allows the AOA to designate other entities which will be in scope on a voluntary basis in addition to mandated in scope entities. The AOA and the audit profession in the Cayman Islands have concluded that there will be occasions when it is in the interests of the audit firms to voluntarily submit to the AOA’s oversight in certain instances not presently covered by the AOL. An example would be to allow a Cayman Islands audit firm to submit itself to AOA jurisdiction instead of being overseen by and inspected by an equivalent overseas authority even though the firm is not required to do so by the AOL. The AOA may now gazette categories of entity which are not in scope through operation of law and allow firms to submit the audits of those entities to AOA oversight on a voluntary basis. All aspects of AOL and Rules will then apply to those audits.
2. Clarification of the AOA’s powers to cooperate with other equivalent overseas authorities: the changes provide the AOA with specific powers, obligations and protections, which are similar to those of the Cayman Islands Monetary Authority.
The other changes were largely administrative or conforming in nature.
A pdf version of the AOL can be found here [http://aoa.ky/download-files].
The AOA Rules will be amended to conform to the AOL changes and published shortly.
The Auditors Oversight (Amendment) Law, 2016