The University of Fiji is proposing the inclusion of professional indemnity insurance for auditors in the revised legislation in one of their submissions on the review of the Audit Act 1969.
If incorporated this will protect contractors and employees of the Office of the Auditor General (OAG) from potential lawsuits arising from errors, omissions, or negligence in their professional services.
In their submission presented by accounting department staff members, Shivneil Kumar Raj, Mohammed Riaz Azam, and Professor Dr. Kishor C. Meher, Uni Fiji also proposed the inclusion of safeguards for the audit team “during the audit engagements to alleviate intimidation, familiarity, and self-review.”
They also recommended setting timelines for audit completion – for entities being audited, preferably within six weeks after the end of the audit period – and the audit team thereafter to ensure the effectiveness of financial statements and other audits.
The university also sought clarity in relation to Section 5, whether under common law principles, vicarious liability would apply as this is where the employer (the OAG) could be liable for tort/negligence committed by their employees or contractors during their employment phase. This point was noted and explained that in such scenarios it is the OAG’s office that would be responsible and not its employees as per section 5.
Fiji’s cabinet announced the review of the act in late April, this year aimed to “ensure that the Office of the Auditor General is able to carry out its functions in line with international standards and best practices.” The review is being carried out by the Ministry of Finance and the OAG.