Document ID: chunk:federal_register_of_legislation:C2025C00185:section:324cc:p3
Version: federal_register_of_legislation:C2025C00185
Segment Type: section
Provision Reference: s 324CC (pt 3/3)
Character Range: 1216115–1217886

situation exists; and
 (e) a director of the audit company would have been aware of the existence of the conflict of interest situation if the audit company had in place a quality control system reasonably capable of making the audit company aware of the existence of such a conflict of interest situation.
Note 1: For conflict of interest situation, see section 324CD.
Note 2: The company itself will commit an offence based on the contravention of subsection 324AA(2).
 (5) For the purposes of an offence based on subsection (4), strict liability applies to the physical elements of the offence specified in paragraphs (4)(a), (b), (d) and (e).
Note 1: For strict liability, see section 6.1 of the Criminal Code.
Note 2: Subsection (6) provides a defence.

Defence
 (6) A person does not commit an offence because of a contravention of subsection (2) or (4) in relation to audit activity engaged in by an audit company at a particular time if the person has reasonable grounds to believe that the audit company had in place at that time a quality control system that provided reasonable assurance (taking into account the size and nature of the audit practice of the audit company) that the audit company and its employees complied with the requirements of this Subdivision.
Note: A defendant bears an evidential burden in relation to the matters in this subsection, see subsection 13.3(3) of the Criminal Code.

Relationship between obligations under this section and other obligations
 (7) The obligations imposed by this section are in addition to, and do not derogate from, any obligation imposed by:
 (a) another provision of this Act; or
 (b) a code of professional conduct.
Note: Paragraph (a)—see, for example, the specific obligations imposed by Subdivision B.