NZICA makes changes to their professional and ethical standards

CA ANZ has released the following communication to their members:

This email is to notify you of some important changes to some of our professional and ethical standards.  Please ensure you read the below information carefully as it is a condition of your licence that you comply with these standards.

If you have any queries or concerns regarding the below or any other aspect regarding your licence, please don’t hesitate to contact us on regulation.nzica@charteredaccountantsanz.com

  1. Revised NZICA Insolvency Services Standard

The New Zealand Regulatory Board has issued a revised NZICA insolvency services standard, IS: Insolvency Services that will apply to all NZICA members and all insolvency practitioners licensed by NZICA from 1 November 2021 (early adoption permitted).

The revised standard reflects changes to New Zealand laws and regulations(in particular, the new insolvency practitioners regime) and the NZICA Code of Ethics.

You can find out more about the changes and obtain a copy of the standard here

  1. Revised NZICA Code of Ethics – Role and Mindset

The New Zealand Regulatory Board has issued a revised NZICA Code of Ethics that incorporates ED 2020-1 Revision of the NZICA Code of Ethics to promote the role and mindset expected of members (revised code).  The NZICA Code of Ethics applies to all insolvency practitioners licensed by NZICA.

The changes included in the revised code reflect recent changes made by the International Ethics Standards Board for Accountants (IESBA) to the International Code of Ethics.  The changes highlight a member’s and LIP’s responsibility to act in the public interest and enhance the fundamental principles and conceptual framework by further clarifying existing requirements and introducing new concepts including the requirement to “have an inquiring mind”.

The changes will take effect on 31 December 2021 (early adoption permitted).

You can find out more information on the changes and obtain a copy of the revised code here

  1. Revised Regulation CR 7 – Continuing Professional Development (CPD)

The New Zealand Regulatory Board and the Chartered Accountants Australia and New Zealand Board have issued a revised regulation CR 7.  This regulation sets out the minimum CPD requirements for all members, LIPs and Non Member Principals approved by NZICA.

As set out in the standard conditions of your licence, should the NZICA requirements exceed those set out in the Prescribed Minimum Standards, you must comply with the NZICA requirements.

For trienniums (3 year period) beginning on or after 1 July 2021, all LIPs must undertake:

At least 120 hours of CPD;

At least 90 hours of the 120 must be verifiable CPD;

At least 20 hours of the 90 verifiable hours must relate to insolvency;

At least 2 hours of the verifiable hours must be ethics training; and

A minimum of 20 hours of the total 120 must be completed each year.

You can find out more about the changes here

Soaring out of Administration – The Virgin Australia Restructure Story

RITANZ is proud to be hosting the following webinar on 28 September 2021:

In March 2020, Virgin Australia Airlines was dramatically impacted by travel restrictions due to COVID-19. What was once a $6 billion turnover business experienced a 95% drop in domestic revenue almost overnight and an immediate shutdown of all international operations. Deloitte were appointed administrators on 20 April 2020, with the goal of making sure this airline survived.

Deloitte, along with its advisors, Houlihan Lokey and Clayton Utz, completed a substantial operational and financial restructure of the business during the administration. In parallel with an operational restructure, a rapid sale campaign resulted in the sale of the business to Bain. The sale was completed on 17 November 2020. With the transaction, Virgin successfully exited voluntary administration, being one of few companies of their size and scale to do so. Virgin was given a second life, and the chance to re-establish itself as an iconic Australian airline.

There were also a multitude of innovative legal applications and hearings to effect the restructure.

At this event, the administrators will tell the story of how Virgin was restructured, sold and successfully exited from administration in the midst of one of the most challenging operating environments ever. 

Sal Algeri

National Restructuring Leader, Deloitte

Sal Algeri is the National Deloitte Restructuring Leader. He has extensive experience in supporting key stakeholders through independent commercial, strategic and financial reviews and supporting the implementation of strategic, financial and operational restructuring initiatives for businesses. 

Sal’s primary focus is to work with the stakeholders and management teams within corporates to rapidly address the improvement in financial performance. His experience covers a wide range of sectors and his assignments vary from crisis management situations, development of business plans and option analysis, and the implementation of performance turnaround strategies.

John Greig

Deputy Chairman, Deloitte Australia Board and Managing Partner, Deloitte Queensland

John is the Deputy Chairman of the Deloitte Australia Board and Managing Partner of Deloitte in Queensland.

Over his 26-year career as a Deloitte Partner, John has served the firm across most of its dimensions. As a Board member overseeing transitions of CEO and Chair, as the Qld Market Leader, as a national Business Unit Executive member, as a Qld Industry Leader, as a Lead Client Service and Advisory Partner on major accounts, as a National Operating Unit Leader and most importantly as a high performing client service delivery partner. 

Richard Hughes

Partner, Financial advisory Deloitte

Richard is the Lead Partner of the Queensland Restructuring Services team of Deloitte and has over 28 years’ professional experience at Deloitte including 20 years with our Restructuring Services team.  Richard specialises in restructuring distressed companies – both as a formally appointed external administrator, but also as an informal advisor to boards, shareholders, lenders and other major stakeholders.

Richard is a chartered accountant, and a member of the FINSIA, ARITA, TMA and AICD organisations.  He is also a registered liquidator.  Richard is a committee member of TMA in Queensland.

Richard’s work includes advising businesses on their operations, restructuring and improving performance.  He is regularly called to negotiate on behalf of clients arrangements with their banks creditors, landlords and other stakeholders and is a safe harbour advisor.

Richard led the teams that were awarded the National Small Business Turnaround of the Year both in 2015 and in 2018 from the Turnaround Management Association for their work with Withcott Seedlings and the Brisbane Broncos, respectively.

Richard has also variously been receiver, administrator or liquidator of a number of companies.  His major assignments have included Kleenmaid, Karen Millen, Riviera Marine, Bryan Byrt, Denmac Ford, Betta Electrical, Harts Australasia and Sam’s Seafood.  More recently Richard was one of the four administrators of Virgin Australia.

Jim McKnight

Managing Director, Houlihan Lokey’s Financial Restructuring Group

Mr. McKnight is a member of Houlihan Lokey’s Financial Restructuring Group. He has over two decades of experience in investment banking and restructuring in Australia and Asia. Mr. McKnight is a market leader in restructuring and recapitalisations, having led most major Australian and Asian restructuring transactions since 2000, advising corporates, lenders (bank syndicates and bondholders), and shareholders across a wide range of sectors.

Mr. McKnight’s notable restructuring engagements include Virgin Australia, Bluewaters Power, CF Asia Pacific, LakeCoal, Wiggins Island Coal Export Terminal, Bis Industries, BrisConnections, Griffin Coal, Griffin Power, Asciano, Centro Retail Trust, GPT, Pacific Brands, Hong Kong Disneyland Resort, SK Global, Seiyu Group, Qenos Pty Ltd., Cross City Tunnel, Freightlink, Inc., Network Ten Pty Ltd., and Reliance Rail.

Prior to joining Houlihan Lokey, Mr. McKnight led the restructuring team at Fort Street Advisers as a Principal from 2013 to 2017 and was Head of Asia Pacific Restructuring and Head of Debt Advisory for Australia at UBS Investment Bank from 2002 to 2013. Prior to joining UBS in 2002, Mr. McKnight spent 12 years in the U.K. specializing in insolvencies, turnarounds, and restructurings.

Mr. McKnight holds a B.Acc. from the University of Glasgow and an MBA from Strathclyde Graduate Business School. He is also a Chartered Accountant with the Institute of Chartered Accountants of Scotland.

Timothy Sackar

National Practice Group Leader, Clayton Utz

With a strong international practice, Timothy Sackar specialises in business restructuring, distressed investing and insolvency. He is the National Practice Group Leader for the Restructuring & Insolvency Group as well as a leader of our Alternate Investment Funds practice.

Timothy has been involved in numerous significant matters in Australia, Asia and the UK, advising debtors, financial creditors, sponsors, bondholders and directors on all aspects of restructurings, workouts and cross-border insolvencies. He has extensive experience in advising on distressed investments and restructuring strategies generally, voluntary and compulsory insolvency regimes, trading of debt for distressed or par values and the sale of non-performing loan portfolios.

He also advises insolvency practitioners on their appointments, duties and the disposal of assets of the estate.

Govt implements temporary Covid-19 measures

A message from MBIE

The Government has decided to implement a range of temporary measures across Commerce and Consumer Affairs legislation that respond to the disruption and uncertainty caused by the re-emergence of COVID-19 in the community. These include delays to the commencement of some new regulatory obligations and flexibility to make it easier for businesses and other entities to operate safely during heightened alert levels. These changes affect forthcoming credit reforms, food country of origin disclosure requirements, and include reapplying temporary relief from 2020 in respect of corporate governance legislation and contract and commercial law.

Of significance to lenders and borrowers the Government agreed to:

1.

Delay the full commencement of the Credit Contracts Legislation Amendment Act 2019 (the Amendment Act) by two months, to 1 December 2021. This was necessary due to the impact of recent COVID-19 alert levels on lenders’ implementation of the reforms, which has disrupted training and other preparations and forced a reprioritisation of resources to support existing customers. This delay will include the regulations that were due to come into force on 1 October 2021, such as the Credit Contracts and Consumer Finance (Lender Inquiries into Suitability and Affordability) Amendment Regulations 2020.

2.

Subject to Parliament passing the necessary legislation, temporarily reactivate amendments made to the Contract and Commercial Law Act 2017 in 2020 to facilitate the electronic execution of security documents containing powers of attorney. It is currently anticipated that this modification will last for an initial period of 6 months from the date of Royal Assent. Relevantly, unlike the modification made in 2020, the Government does not currently intend to make this modification retrospective.

You may also be interested to hear that the Government has similarly, subject to Parliament passing the necessary legislation, agreed to reinstate the compliance relief contained in the COVID-19 Response (Requirements For Entities—Modifications and Exemptions) Act 2020. This will enable organisations:

a) to do certain matters – including holding meetings, signing instruments, and voting on certain matters – electronically even if their constitutions or rules do not provide for it; and

b) to more easily modify certain requirements or restrictions in their constitution or rules (for example, defer reporting, or waive members’ fees).

New insolvency regime comes into effect

This media release is prepared by, and shared courtesy of, Chartered Accountants Australia and New Zealand.

The new co-regulatory licensing regime for insolvency practitioners comes into full effect today, requiring all practitioners to hold a licence from the sole accredited front-line regulator, the New Zealand Institute of Chartered Accountants (NZICA).

This finalises the implementation of the Insolvency Practitioners Regulation Act 2019 (the Act), following a transitional period from 1 September 2020.

During that period, practitioners were required to conclude or resign from any ongoing insolvency appointments prior to 1 September 2021, or obtain a licence to continue work on their appointments after the transitional period.

All formal insolvency engagements such as voluntary administrations, receiverships and insolvent liquidations, both ongoing and new, must now be undertaken by a licensed insolvency practitioner.  Practitioners must apply to an accredited body to obtain an insolvency practitioner licence.  The New Zealand Institute of Chartered Accountants (NZICA) is currently the only accredited body in NZ.

Licensed insolvency practitioner details can be found on the Companies Office register.

CA ANZ NZ Country Head Peter Vial FCA says that the introduction of the new regime is an important milestone for insolvency appointments in New Zealand.

“Insolvency practitioners have a responsibility to ensure that the assets of insolvent businesses are realised and distributed in accordance with clear rules and duties to both the insolvent party and their creditors.”

“The new licensing regime is integral to lifting standards and promoting quality and integrity in the profession.”

“As the front-line regulator we will serve the public by carrying out duties under the Act, including licensing, monitoring, and providing a complaints process to ensure that insolvency practitioners are meeting the required standards.”

It is important to note that solvent liquidations can still be undertaken by qualified statutory accountants and lawyers, as well as by licensed insolvency practitioners.

For more information visit the CA ANZ insolvency practitioners page,  FAQ page or the Act.