Williams Andrew: Accounting Infrastructure Reform Bill — First ReadingText is incorporated into the Bound VolumeWilliams Andrew: Accounting Infrastructure Reform Bill — First Reading[Sitting date: 28 January 2014. Volume:696;Page:15599. Text is incorporated into the Bound Volume.]ANDREW WILLIAMS (NZ First): I take a call on behalf of New Zealand First on the Accounting Infrastructure Reform Bill. New Zealand First will be supporting this from its first reading through to the Commerce Committee for the very reason that we see merit in some aspects of the bill. However we do have some concerns in other areas. With that in mind we feel that it is appropriate for this to go to the select committee to allow New Zealanders New Zealand accounting firms New Zealand auditing firms and all those others involved to have their say in this legislative process.New Zealand First supports this bill for the fact that it will help reduce compliance costs for small companies. We are a party that supports New Zealand enterprise and we stand by the reduction in costs to operate small companies in New Zealand which are increasingly burdened by compliance costs. The audit and accounting industry will be more efficient as a result of this legislation we are told so it will be interesting to see how this bill coming through the select committee process will show the greater efficiencies that can be achieved.We are also advised that accredited bodies will allow members to conduct audits under their umbrella controls. Therefore as a result if you are part of an accredited body an auditing company you are supposedly accredited to conduct audits. Therefore it will be interesting to see how that fleshes out through the select committee process as to how those accredited bodies will administer that.It is interesting that this bill replaces the longstanding terminology of “chartered accountant” with new terminology: “qualified statutory accountant”. Again whether or not that has much meaning we do not know but the longstanding term where people say that you have to get a chartered accountant goes back a long way in New Zealand’s history. Again it will be interesting to see whether this is just playing with names or whether there is any real substance to that name change.This bill will also if enacted allow overseas audit companies to operate in New Zealand. We are advised that many companies that have international auditors currently have difficulties in that they have to have a local auditor to undertake their work and that provides some difficulties for some international operators and I can imagine that could be the case. There would be merit in that change. We would hope that as a result of this bill many international firms might see fit to establish offices here in New Zealand to conduct such audits on behalf of some of their global companies. New Zealand would gain by international audit companies establishing local branches.We are also advised that in terms of charities larger charities would be required to be audited by qualified auditors. We see merit in that. When you are the purse holders of public money taking public charity money in excess of $1 million there is great merit in ensuring that those funds are audited correctly. Therefore we see that there is advantage in ensuring for those New Zealanders who are donating—and New Zealand has a reputation for being one of the highest-donating countries in the world per capita—that those funds are properly administered. Medium-sized charities in the order of half a million dollars up to $1 million will require audit or reviews and those smaller charities under half a million dollars will have lesser requirements.Again as we have heard from other members when you are talking about very small charities the burden in terms of auditing and compliance can be very onerous and it canchew into a lot of the very good money that is being donated to those charities. Again if through the select committee process we can identify ways that very small charities can reduce their costs then that would be a benefit.This bill also brings together the opportunity for New Zealand and Australian accounting bodies to come together as one trans-Tasman statutory body to oversee Australasian auditing. This is an interesting process bringing those trans-Tasman accounting practices together. We do operate in a CER situation where we do try to operate in harmonisation with our Australian sister country and therefore this can potentially bring great benefit to both sides of the Tasman by being able to offer standard practices across businesses on both sides of the Tasman.However as New Zealand First has always said we would have great concerns if this was seen as some sort of takeover of New Zealand accounting practices by Australian practices. We are informed that this is not the case and that indeed it could be the reverse whereby the smaller partner could in fact benefit much more greatly by being part of this harmonisation with Australia and many Australian firms could actually look to New Zealand firms to conduct much of their business on this side of the Tasman on their behalf. If that is the case and we benefit out of it then that is fantastic. However if it is another situation as in the banking industry where the Australian side of the deal seems to be the great benefactor then New Zealand First would have grave concerns about that. So we will be following that issue through the select committee process and we look forward to submissions from all those involved to flesh this out and ensure that New Zealand does indeed protect its interests.Just in closing New Zealand First has always stood on a basis of supporting New Zealand commerce supporting New Zealand business and particularly supporting greater efficiency in New Zealand business. We have always stood for reducing compliance costs and helping our people of New Zealand operate for the benefit of all New Zealand citizens and all New Zealand businesses. We see significant merit in many aspects of this bill and we will be following the bill through the select committee process with great intensity. Thank you.