Section 107: Appointment and duties of auditors

107. Appointment and duties of auditors (1) The Commission shall not approve an audit firm under section 106 (4) or (5) unless it is satisfied that the audit firm has adequate experience, expertise and resources to carry out such an audit. (2) The Commission may require the auditor of a CIS manager or collective investment scheme to submit such additional information in relation to his audit as the Commission considers necessary. (3) Where in the course of his work, the auditor of a CIS manager or of a collective investment scheme becomes aware of any matter which is such as to give the auditor reasonable cause to believe that— (a) there has been a material adverse change in the risks inherent in the business of a CIS manager or a collective investment scheme, as the case may be, with the potential to jeopardise the ability of the CIS manager or the collective investment scheme to continue as a going concern; (b) the CIS manager or the collective investment scheme may be in contravention of this Act, any regulations made under this Act, any FSC Rules or any directions issued by the Commission; S7 – 41 [Issue 1] Securities Act (c) a criminal offence involving fraud or dishonesty has been, is being or is likely to be committed; or (d) serious irregularities have occurred, the auditor shall report such matter in writing to the Commission. (4) No duty to which an auditor of a CIS manager or of a collective investment scheme may be subject shall be regarded as breached by reason of his communicating in good faith to the Commission any information under subsection (3).