Commencement of proceedings
Proceedings before CADB may only be commenced by ASIC or APRA. Proceedings are commenced by filing an Application PN1 Annexure B with CADB. Applications must set out the orders sought against the Respondent and the grounds relied upon. The grounds relied upon must be particularised in a Concise Outline attached to the Application. A guide to preparing a Concise Outline can be found in PN1 Annexure A.
Service of Application – filing of Response
Once an Application and Concise Outline have been filed, CADB will seal and date these and return them to the Applicant, for service upon the Respondent, together with a Notice to Parties (PN1 Annexure D). The Notice to Parties informs the Respondent of the opportunity to appear at a hearing before CADB and directs the Respondent to file and serve a Concise Response (PN1 Annexure F) to the Concise Outline, if the Respondent seeks to appear at a hearing.
Pre-Hearing Conference
The Chairperson of CADB will convene a Pre-hearing Conference with the parties to provide directions for the preparation of the matter for hearing. The Chairperson will make directions for the timing of the preparation of evidence and submissions and the fixing of a hearing date.
Hearing
The hearing of an application takes place before a Panel of members, (either five members or three members), consisting of the Chairperson or Deputy Chairperson and equal numbers of accounting members and business members. Hearings are held in private unless the Respondent requests the hearing in public.
On Conduct Applications, the Hearing will usually be split into a first hearing, which deals with whether the grounds for making orders against the auditor have been established and a second short hearing to consider the appropriate sanctions, having regard to the findings of the Panel.
At a Hearing, the proceedings must be conducted with as little formality and technicality, and with as much expedition, as the requirements of the Corporations legislation and a proper consideration of the matters before the Panel permit. The Panel is not bound by the rules of evidence. The Panel must observe the rules of natural justice at and in connection with a Hearing. The parties may be legally represented at the hearing. CADB may summons witnesses required for the Hearing.
Proceedings at a Hearing proceed in the usual way of hearings, with the Applicant presenting its case, tendering documentary evidence and calling witnesses. The Respondent may object to evidence and cross-examine witnesses. The Respondent’s case is then presented in a similar way. The parties then make submissions.
The Panel is likely to reserve its decision unless the matter is an Administrative matter.
Decisions
When the Panel decides that the grounds for the Application have been established on a Conduct application, it will reconvene the Hearing to take evidence and submissions on appropriate sanctions, before issuing its Decision. If the Panel decides to exercise its powers against the auditor, the Decision will usually be published. If it does not, the Decision will not be published. The losing party will usually be required to pay the costs.
Procedural Rules
CADB has issued a Practice Note 1 (PN1), which contains procedural rules and guidance relating to proceedings before the Board.
CADB has also issued a Practice Note 3 (PN3) containing procedures relating to costs.
PN3 - Guidance and Procedures Relating to Costs Orders Published (PDF 239 KB)
Related information
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Overview of CADB Process
Information about the types of applications which may be brought to the Board and how they are dealt with
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Information for Respondents
Information for registered company auditors who have been served with an Application