APPROVAL OF AMENDMENTS TO THE SUPPLEMENTAL ROYAL CHARTER AND BY-LAWS OF CHARTERED ACCOUNTANTS AUSTRALIA AND NEW ZEALAND
Chartered Accountants Australia and New Zealand (CA ANZ) sought approval to amend the Supplemental Royal Charter (Charter) and By-Laws and these were approved by the Governor-General on 30 July 2019.
The proposed amendments to the Charter and By-Laws were approved by resolutions passed by Member vote in an electronic and postal ballet of Members conducted in accordance with the Charter and By-Laws in April and May 2019.
Article 21 of the Charter provides that subject to the provisions of Article 22, CA ANZ may from time to time, by resolution approved by a ballot conducted in accordance with the By-Laws, make such By-Laws for the better execution of the Charter, the furtherance of the objects of CA ANZ and generally for regulating the affairs of CA ANZ as CA ANZ sees fit, and may from time to time rescind, vary or add to any By-Laws and make others in their stead, but so that the By-Laws for the time being be not in any respect repugnant to the laws of the Commonwealth of Australia or any of the States or Territories comprised in the said Commonwealth, the laws of New Zealand or of any territory or dependency in respect of which the Parliament of New Zealand may make laws, or inconsistent with the expressed provisions of the Charter.
Article 22 of the Charter provides that no By-Law or any rescission or variation thereof or addition thereto shall come into operation until the same shall have been submitted to and approved by Our Governor-General in and over the Commonwealth of Australia or the person for the time being administering the Government of the Commonwealth of Australia.
Article 23 of the Charter provides that the Board of CA ANZ shall cause all such By-Laws, when approved to be printed and published together with the formal approval of Our Governor-General in the Official Gazette of the Commonwealth of Australia.
The principal amendments to the Charter include:
Overseas Regional Councils
The amendments allow CA ANZ to create Overseas Regional Councils in Hong Kong, Malaysia, Singapore and the United Kingdom. The Overseas Regional Councils have the same functions and powers of existing Regional Councils as prescribed by the By-Laws.
Other changes
- The Chief Executive Officer and Board delegates can sub-delegate to CA ANZ officers and employees to fulfil operational requirements; and
- Terms in the Charter have been updated to reflect current practice, new conventions and to clarify previously undefined terms.
The principle amendments to the By-Laws include:
Composition of CA ANZ Council
The amendments increase the composition of the CA ANZ Council to a range between sixteen and twenty-five. The number of office bearers (a President and 2 Vice-Presidents) and a total number of 12 councillors representing Australia (7), New Zealand (4) and the Asian region (1) remain the same. The amendments provide for a new councillor from the United Kingdom and give the CA ANZ Council the power to appoint up to 9 additional councillors with one of these positions intended to be reserved for a councillor from a region that does not have a Regional Council or an Overseas Regional Council.
CA ANZ Councillors will serve a single 3 year term with a maximum of 2 terms, except the councillor representing the Asian Region whose position on CA ANZ Council rotates every 3 years between one representative from the Overseas Regional Council of either Hong Kong, Malaysia or Singapore.
Composition of the Nominations and Governance Committee
The total number of independent members has increased from 2 to 3 and the Chair of the Committee is appointed from the independent members. The total size of the Committee has been reduced from 7 to 5 members, as the 2 Vice-Presidents no longer form part of the composition of the Committee.
Composition of the Board
The Board has increased from ten to twelve directors with the inclusion of the 2 Vice-Presidents as directors (they were previously only observers on the Board).
Calling Council or Board Meetings
The amendments require the CA ANZ President to call a meeting of the CA ANZ Council at the request of 3 councillors.
In addition, the President or Board Chair may call a joint meeting of the CA ANZ Council and Board at the request of 3 councillors or 3 directors respectively.
Director terms of appointment
The amendments increase the maximum number of terms a director may serve on the Board from 2 terms to 3 terms of 3 years each.
Composition of Regional Councils and Overseas Regional Councils (excluding New Zealand Council)
Regional Councils and Overseas Regional Councils (excluding the New Zealand Council) now comprise of up to 10 members. This includes six elected councillors, 3 councillors appointed by the Regional Council itself and, at the Regional Council’s discretion, one CA ANZ Councillor who represents the Australian Region as an ex-offico member for the duration of their CA ANZ Council term only.
Composition of New Zealand Council
The New Zealand Council retains its sixteen members; however, this must be comprised of twelve elected and four appointed members.
Composition and appointment of New Zealand Local Committees
Local Leadership Teams in New Zealand are re-named Local Committees. Each Local Committee will comprise of between 5 to 10 members appointed for a maximum of 2 terms of 3 years each. Local Committee members will be appointed by the Board through a delegated authority to the New Zealand Council. One third of the Local Committee members must retire each year.
Professional Conduct Committee (PCC)
The amendments strengthen the PCC’s powers to:
- dismiss complaints without notifying Members where the complaint is lacking in substance, vague or imprecise or unsupported by evidence;
- issue a professional reminder where expected high standards are not met, even where a complaint is dismissed;
- permit acceptance of new complaints against a Member who is interim suspended; and
- require all complaints involving matters of high public interest or requiring independent evidence to be referred to the Disciplinary Tribunal.
In addition, the amendments alter the sanctions which can be agreed between the PCC and a Member as follows:
• decreasing the fine amount to $25,000;
• permitting the PCC to agree the terms on which a Member must complete training; and
• permitting the PCC to impose any type of review on a Member, in addition to Quality Review.
Disciplinary and Appeals Tribunal (Tribunals)
The amendments allow changes to the Tribunals procedures to give them the ability to:
• extend the service timeline for the Notice of Disciplinary Action and allow Members to respond to issues earlier;
• permit the notification of disciplinary decisions to Members’ current or former employers, partners or clients;
• permit the Appeals Tribunal to extend the time for appeal by the PCC to align with similar powers in relation to members;
• remove the PCC’s power to adjourn hearings; and
• permit the Tribunals to remove a CA ANZ specialisation from a Member who is found to have breached the By-Laws.
In addition, the amendments alter the sanctions which can be imposed by the Tribunals as follows:
• decreasing the fine amount to $50,000;
• replacing the sanctions of reprimand and severe reprimand with censure;
• permitting the Tribunals to impose the terms on which a Member must complete training; and
• permitting the Tribunals to impose any type of review on a Member, in addition to a quality review.
The amendments change CA ANZ’s disciplinary procedures to:
• permit the Appeals Tribunal to require payment of a bond if it considers it appropriate, before hearing an appeal;
• add additional areas of misconduct so that a Member also breaches the By-Laws if:
- they have provided information to CA ANZ or the New Zealand Institute of Chartered Accountants (NZICA) which is false or misleading;
- they have failed to comply with any decision or determination of the disciplinary bodies;
- they have failed to comply with an undertaking given by any of the disciplinary bodies;
• permits the PCC to refer a Member directly to the Disciplinary Tribunal in relation to any of the above events; and
• ensures full reciprocity and transparency of decisions and sanctions between CA ANZ and NZICA.
Insolvency
The amendments make the definition of misconduct more comprehensive by including insolvency of a non-member entity with a member principal as an insolvency event. As an insolvency event, this would breach the By-Laws and result in disciplinary action against the member principal.
Other changes
The amendments also allow for:
• name changes to CA ANZ’s Segment Advisory Committees to Sector Committees;
• an increase in the maximum number of CA ANZ Life Members from 20 to 40;
• the Chief Executive Officer and Board delegates to sub-delegate to CA ANZ officers and employees to fulfil operational requirements;
• an update to terminology to reflect current practice, new conventions and clarify previously undefined terms; and
• the correction of grammar, punctuation and other formatting errors.
Full versions of the Charter and By-Laws are available on the CA ANZ website.