Halifax Investment auditor Robert James Evett has been dealt another punishing blow over his involvement with failed Halifax Investment Services

The auditor of a Gold Coast investment firm that has left more than $211 million of investor funds frozen since it collapsed in 2018 has had his auditor registration cancelled over his “serious neglect”.

Halifax Investment Services collapsed in November 2018.

THE auditor of a Gold Coast investment firm that left $211 million of investor funds frozen since it collapsed in 2018 has had his auditor registration cancelled for “serious neglect”.

Halifax Investment Services was placed into voluntary administration in November 2018, freezing $211 million in investments of 10,000 people.

Robert James Evett was convicted and fined more than $50,000 last month over charges brought by ASIC against him and his company EC Audit, previously known as Bentleys NSW Audit.

A Companies Auditors Disciplinary Board ruling has further found he was not a fit and proper person to remain registered as an auditor.

“Mr Evett’s conduct was not the result of what might be described as a momentary lapse or isolated incident,” the ruling said.

“Rather it was attributable in our view to a serious neglect on his part to perform his duties, especially the significant responsibilities of Engagement Partner, Lead Auditor and the Lead Assurance Practitioner in the three Halifax Audits, with very serious consequences.”

Mr Evett and EC Audit were the first auditors in Australia to face criminal charges and to be sentenced under section 989CA of the Corporations Act.

The charges related to audits conducted by Mr Evett, as lead auditor, and EC Audit, as audit company, of the profit and loss statements and balance sheets of Halifax for three consecutive financial years from 2016-2018.

In delivering the sentence, the court noted that if the audits had been properly conducted, Halifax may not have continued to trade while effectively insolvent.

EARLIER, AUGUST 18:

THE auditor of a former Gold Coast investment firm that has left more than $211 million of investor funds frozen since it collapsed in 2018 has been convicted and fined more than $50,000 over charges brought by the corporate regulator.

ASIC brought the charges against company EC Audit, previously known as Bentleys NSW Audit, and its director and registered auditor, Robert James Evett, for breaches of auditing standards.

Mr Evett and EC Audit are the first auditors in Australia to face criminal charges and to be sentenced under section 989CA of the Corporations Act.

EC Audit and Mr Evett pleaded guilty to the charges last month.

The charges relate to audits conducted by Mr Evett, as lead auditor, and EC Audit, as audit company, of the profit and loss statements and balance sheets of Halifax for three consecutive financial years from 2016-2018.

ASIC Commissioner Cathie Armour

Administrators of Halifax Investment Services say director Jeff Worboys paid his Bentley lease, rent with company funds

ASIC said EC Audit failed to understand Halifax’s business and failed to design appropriate tests to identify material misstatements in the accounts and that Mr Evett failed to take responsibility for the overall conduct of the audits and failed to ensure that staff with appropriate skills were conducting the audits.

In delivering the sentence, the court noted that if the audits had been properly conducted, Halifax may not have continued to trade while effectively insolvent.

ASIC Commissioner Cathie Armour said auditors were important gatekeepers to the market and played a key role in ensuring financial reports are free from misstatements.

“In taking this action against EC Audit, ASIC is sending a message to auditors to maintain a strong culture focused on audit quality and that any serious failure to comply with auditing standards will be prosecuted,” she said.

The Commonwealth Director of Public Prosecutions prosecuted the matter after a referral from ASIC.

Follow @Kathleenskene

Originally published as Halifax Investment auditor Robert James Evett has been dealt another punishing blow over his involvement with failed Halifax Investment Services