The management committee may appoint the auditor or reviewer for the purpose of meeting the Tier 2 or 3 reporting requirements. Where the auditor or reviewer is appointed by the management committee they will remain in office until their report has been presented for consideration at the annual general meeting (or they resign).
If the association appoints an auditor or reviewer for any other purpose such as at the request of the members or to provide ongoing services the appointed auditor or reviewer will then remain in office unless they:
- resign;
- are removed from office;
- cease to be qualified to conduct audits or reviews;
- die; or
- become an insolvent under administration.
To ensure there is a clear understanding of the duties and responsibilities of the auditor or reviewer the committee should request an engagement letter setting out:
- their responsibilities;
- the scope of the work to be completed;
- the total cost; and
- the expected time frame is for completion.
The auditor or reviewer must be independent and the association should avoid appointing:
- a past or present member of the management committee;
- a member of the association;
- an employee, supplier of goods or services or a servant of the association; or
- an employer, partner or family member of a member of the association’s management committee.