Former member of Big Un Limited’s audit team, Jakin Loke, has had his company auditor registration suspended for a year after the corporate regulator applied to the industry’s disciplinary board.
The Australian Securities and Investments Commission (ASIC) applied to the Companies Auditors Disciplinary Board (CADB) relating to Mr Loke’s involvement in the 2017 audit of Big Un.
Ecovis Clark Jacobs auditor Jakin Loke has been suspended from audits for 12 months.
“Mr Loke’s failures are not insignificant, and the 12-month suspension of his registration as a company auditor reflects that,” CADB said in its ruling.
“In addition to having an appropriate deterrent effect on Mr Loke, the suspension will protect the public until, pursuant to the undertakings proposed, Mr Loke will have engaged in education and learning that covers all of the areas identified as a result of these proceedings.”
Mr Loke has given an undertaking to ASIC to complete a further 45 hours of professional education and his first three audits after his suspension is lifted will be peer reviewed by another registered company auditor.
Big Un collapsed in early 2018 after a series of reports in The Australian Financial Review questioned how the fast-growing company was achieving its stellar growth. ASIC’s investigation into Big Un is ongoing.
ASIC argued Mr Loke failed in his duties as an auditor for a range of reasons, including having carried out auditing duties when he should have known his firm, Ecovis Clark Jacobs, had a conflict of interest, which affect the firm and his ability to show the required independence required by professional accountants.
“Mr Loke was involved in the audit of the 2017 financial statements of Big Un Limited, which was then a public company listed on the ASX,” ASIC said in a statement.
“He participated in the 2017 audit as a member of the Ecovis Clark Jacobs (ECJ) audit engagement team, working under the supervision of Graham Swan of Rothsay Resources and Rothsay Auditing, who were appointed by Big Un to perform the 2017 audit.”
CADB acknowledged Mr Loke’s co-operation with ASIC and agreement to pay $95,000 of the corporate regulator’s costs in making its decision.
“The CADB also found that Mr Loke failed to meet relevant audit benchmarks when he accepted accounting records at face value without obtaining additional evidence, and signed off on audit papers without providing appropriate audit evidence,” ASIC said.
“As a result, he failed to identify issues that were likely to impact Big Un’s ongoing viability.”
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