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Appointment of Auditors
Amended on 23 August 2018.
712
(1) An issuer must appoint a suitable auditing firm to meet its audit obligations, having regard to the adequacy of the resources and experience of the auditing firm and the audit engagement partner assigned to the audit, the firm's other audit engagements, the size and complexity of the listed group being audited, and the number and experience of supervisory and professional staff assigned to the particular audit. A mineral, oil and gas company must appoint an auditing firm where the auditing firm and audit partner-in-charge have the relevant industry experience.(2) The auditing firm appointed by the issuer must be:(a) Registered with the Accounting and Corporate Regulatory Authority ("ACRA");(b) Registered with and/or regulated by an independent audit oversight body acceptable to the Exchange. Such oversight bodies should be members of the International Forum of Independent Audit Regulators, independent of the accounting profession and directly responsible for the system of recurring inspection of accounting firms or are able to exercise oversight of inspections undertaken by professional bodies; or(c) Any other auditing firm acceptable by the Exchange.(3) A change in auditing firm must be specifically approved by shareholders in a general meeting. The notice of meeting must incorporate:(a) confirmation from the outgoing auditors as to whether they are aware of any professional reasons why the new auditors should not accept appointment as auditors of the issuer, and if so, to provide reasons;(b) confirmation from the issuer as to whether there were disagreements with the outgoing auditors on accounting treatments within the last 12 months, and if so, to provide details;(c) confirmation from the issuer as to whether it is aware of any circumstances connected with the change of auditors that should be brought to the attention of the shareholders of the issuer; and(d) specific reasons for the change of auditors, including whether the outgoing auditors resigned, declined to stand for election or were dismissed.Amended on 29 September 2011 and 23 August 2018.
713
(1) An issuer must disclose in its annual report the date of appointment and the name of the audit partner in charge of auditing the issuer and its group of companies. The audit partner must not be in charge of more than 5 consecutive audits for a full financial year, the first audit being for the financial year beginning on or after 1 January 1997, regardless of the date of listing. The audit partner may return after two years.(2) If the listing of an issuer occurs after 5 consecutive audits by the same audit partner in charge, the same audit partner may complete the audit of the financial year in which the issuer lists.714
The Exchange may object to the appointment of an auditor or may require an issuer to replace its auditor if the Exchange is of the opinion that it is in the interest of shareholders to do so or that the new auditor does not satisfy the requirement in Rule 712. This rule does not apply to a financial institution licensed or approved by the Authority.
Amended on 29 September 2011.
715
(1) Subject to Rule 716, an issuer must engage the same auditing firm based in Singapore to audit its accounts, and its Singapore-incorporated subsidiaries and significant associated companies.(2) An issuer must engage a suitable auditing firm for its significant foreign-incorporated subsidiaries and associated companies.Amended on 29 September 2011.
716
An issuer may appoint different auditing firms for its subsidiaries or significant associated companies (referred to in Rule 715(1)) provided that:
(1) the issuer's board and audit committee are satisfied that the appointment would not compromise the standard and effectiveness of the audit of the issuer; or(2) the issuer's subsidiary or associated company, is listed on a stock exchange.Amended on 29 September 2011.
717
An issuer must disclose in the annual report the names of the auditing firm(s) for its significant subsidiaries and associated companies.
Amended on 29 September 2011.
718
For the purpose of Rules 715 to 717, a subsidiary or associated company is considered significant if its net tangible assets represent 20% or more of the issuer's consolidated net tangible assets, or its pre-tax profits account for 20% or more of the issuer's consolidated pre-tax profits.
