“Executive Board means the Executive Board of the Institute referred to in section 6(1)(e)

“specified association means the association of accountants that is declared to be the specified association under section 8A”.

“2A Transitional, savings, and related provisions

• The transitional, savings, and related provisions set out in Schedule 1AA have effect according to their terms.”

• “(aa) to carry out the duty imposed under section 5A:”.

• “(b) to promote the profession of accountancy by its members in New Zealand:”.

“5A Duty to control and regulate profession of accountancy practised by members in New Zealand

• “(1) The Institute must, with reasonable skill and care, control and regulate the practice of the profession of accountancy by its members in New Zealand.

  “(2) The duty under subsection (1) includes—

  • “(a) maintaining, complying with, monitoring compliance with, and enforcing the rules referred to in section 6(1)(f) to (ja) (which relate to the investigation and hearing of complaints and other matters, appeals, disciplinary matters, and the recognition of auditors); and

  • “(b) maintaining, monitoring members' compliance with, and enforcing professional and ethical standards, including the code of ethics required by section 7; and

  • “(c) monitoring members' compliance with the Auditor Regulation Act 2011 and other enactments that relate to the practice of accountancy; and

  • “(d) monitoring compliance with, and enforcing, section 14; and

  • “(e) complying with the Institute's duties—

    • “(i) as an accredited body under the Auditor Regulation Act 2011; and

    • “(ii) that are imposed on the Institute (by name) under any other enactment.

“5B Institute must perform duty to control and regulate profession but may delegate other functions

• “(1) The Institute must not delegate the duty under section 5A (in whole or in part) to any person.

  “(2) The Institute may delegate the functions specified in section 5(a), (b), (c), and (d) (except to the extent that those functions relate to the duty in section 5A), either generally or specifically, to any other person.

  “(3) Subsection (2) is subject to subsection (1).

“5C Specified association may act in its own interests rather than Institute's interests

• “(1) This section applies to the specified association if any functions referred to in section 5B(2) are delegated to the association.

  “(2) The specified association may, when performing a delegated function, act in a manner that the association believes is in the best interests of the association (or its members) even though it may not be in the best interests of the Institute (or the Institute's members).

  “(3) Subsection (2) does not permit the specified association to act in a manner that may materially prejudice the Institute's ability to carry out the duty imposed under section 5A.”

• “(ja) the recognition of persons for the purposes of sections 36(1)(a) and 36A of the Financial Reporting Act 2013, for keeping such recognition under review, and for the cancellation and suspension of such recognition; and

• “(jb) the powers of a person to whom functions are delegated under section 5B(2), the effect of a delegation on the Institute, and the revocation of a delegation; and”.

• “(6) The code of ethics prescribed by the Council and that is in force immediately before the commencement of this subsection continues in force and may be amended, revoked, or replaced by the Executive Board under subsection (4).”

“7A Membership rules may require membership of specified association

• “(1) The rules that relate to the matters referred to in section 6(1)(b) (admission of members and the cessation of membership) may provide for either or both of the following:

  • “(a) that a person may be admitted as a member of the Institute only if the person is a member of the specified association:

  • “(b) that a person ceases to be a member of the Institute if the person—

    • “(i) does not become a member of the specified association in accordance with the rules; or

    • “(ii) ceases to be a member of the specified association.

  “(2) Those rules may provide for a cessation referred to in subsection (1)(b) to be automatic or to occur after a specified process.

  “(3) This section does not limit section 6(1)(b) (and, in particular, the ability to provide for other requirements for the admission of members).”

“Provisions concerning specified association

“8A Specified association

• “(1) The Governor-General may, by Order in Council made on the recommendation of the Minister of Commerce, declare an association of accountants to be the specified association for the purposes of this Act.

  “(2) The Minister of Commerce may make a recommendation under subsection (1) only after consulting the Institute.

  “(3) In this section, association of accountants includes any association or other professional body of accountants (whether constituted or established overseas or in New Zealand).

“8B Members of Council or Executive Board may act in best interests of specified association rather than Institute

• “(1) This section applies to a person (A) who is appointed by or on behalf of the specified association, in accordance with the rules of the Institute, to be a member of either or both of the following:

  • “(a) the Council:

  • “(b) the Executive Board.

  “(2) A may, when exercising powers or performing duties as a member of the Council or the Executive Board, if expressly permitted to do so by the rules of the Institute, act in a manner that he or she believes is in the best interests of the specified association (or its members) even though it may not be in the best interests of the Institute (or the Institute's members).

  “(3) Subsection (2) does not permit A to act in a manner that may materially prejudice the Institute's ability to carry out the duty imposed under section 5A.”