Australian Fiduciaries auditor suspended for three years

Queensland-based Australian Fiduciaries' auditor Cameron Bradley, formerly a partner of PKF Brisbane Audit, has been suspended for three years by the Companies Auditors Disciplinary Board (CADB) until 30 June 2028.

The board found Bradley failed to exercise professional scepticism and judgement as well as perform appropriate audit procedures for three managed investment schemes with Australian Fiduciaries as the responsible entity.

The three schemes included the Global Diversified Alpha Fund, Global All Seasons Fund and Global Multi-Strategy Fund.

Last year, ASIC started an investigation into Australian Fiduciaries on concerns of inadequate management of conflicts of interest, the ways investors were sold units in its schemes and how their funds were ultimately invested, as well as the lack of regular valuation checks of its schemes.

The disciplinary board found Bradley's failings were not on the margins of the audit function but went to its core.

"This is not a case of an isolated or technical breach on a single audit; it involved foundational obligations of an auditor - the obligation to obtain sufficient appropriate audit evidence, to exercise professional scepticism and to prepare documentation sufficient to allow an experienced auditor with no connection to the audit to understand what was done," CADB said.

"These were not technical or lesser-known requirements. They are obligations imposed on every auditor in every audit regardless of the complexity of the entity being audited."

The board further reprimanded Bradley and requires him to give certain undertakings, including future peer reviews and additional continuing professional development.

ASIC recently also cancelled the AFSL of Australian Fiduciaries, which is currently in liquidation, following its inability to pay the amount determined by the Australian Financial Complaints Authority (AFCA).

"ASIC has consistently highlighted the importance of robust valuation practices, governance and audit quality, including in private markets," ASIC commissioner Kate O'Rourke said.

"Auditors provide an important line of defence for investors. When audits fail to appropriately interrogate significant assets and valuations, confidence in those markets can be undermined. This outcome sends a clear message that auditors must meet the fundamental standards expected of the profession."

ASIC believes around 600 retail investors had invested approximately $160 million into managed investment schemes run by Australian Fiduciaries since February 2020, predominantly through their self-managed super funds (SMSFs).

Australian Fiduciaries ceased distributing units in the schemes in September 2023.