Former Big Un Limited auditor Jakin Leong Loke’s company auditor registration has been suspended for 12 months by the Companies Auditors Disciplinary Board (CADB) following an application by ASIC.
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. 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.
ECJ were engaged to manage the day-to-day audit activities despite one of the partners of ECJ being the company secretary of Big Un. The CADB found that Mr Loke should have been aware of this conflict of interest, which affected his and ECJ’s independence in managing the audit activities.
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. As a result, he failed to identify issues that were likely to impact Big Un’s ongoing viability.
In making its decision, the CADB said, ‘Mr Loke’s failures are not insignificant, and the twelve month suspension of his registration as a company auditor reflects that.’
Mr Loke provided an undertaking to ASIC that he would complete an additional 45 hours of professional education. He also provided an undertaking that his first three company audits following the completion of his suspension would be subject to peer review by another registered company auditor.
The CADB acknowledged Mr Loke’s undertakings, as well as his cooperation with ASIC, including his agreement to pay $95,000 towards ASIC’s costs. The CADB considered these key reasons that a suspension was considered appropriate.
