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ASIC has accepted an enforceable undertaking (EU) from the principal of a South Australian accounting firm after an investigation found fault in his conduct as a voluntary administrator.
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Accounting firm's principal hit with ASIC action
08 December 2015
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The regulator accepted the EU from Adelaide-based registered liquidator Anthony Christopher Matthews, principal of accounting firm Anthony Matthews & Associates.
The EU comes after ASIC reviewed Mr Matthews’ conduct as voluntary administrator of Sapphire (SA) Pty Ltd (formerly trading as River City Grain Co.) and deemed that he had failed in his duties.
According to ASIC, Mr Matthews failed to identify possible insolvent trading claims against Sapphire’s holding company and/or ultimate holding company, failed to investigate a deed of settlement promising debts, and failed to investigate the attempted assignment of two sales contracts.
ASIC also found that Mr Matthews did not properly and adequately document his investigations, provide an accurate report to creditors or report possible director misconduct to ASIC.
“Registered liquidators must fully meet their duty to creditors to adequately investigate and document investigations and report alleged offences to ASIC,” said John Price, ASIC commissioner.
“This very much goes to ensuring confidence in the insolvency and ASIC’s supervision of that market,” he added.
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Under the conditions of the EU, Mr Matthews is prevented from accepting any new appointments for two months, with the exception of one matter where, prior to commencement of the EU, he had filed consent to act with the court.
Mr Matthews is also required to appoint an independent expert at his own cost to review his insolvency practice.
ASIC acknowledged Mr Matthew’s cooperation in resolving the matter, and noted that he has currently taken steps that include:
• Undertaking public examinations of Sapphire’s director and other parties;
• Updating practice systems and procedures, including investigation checklists; and
• Engaging an external consultant to provide bi-monthly staff training sessions.
“ASIC continues to work with practitioners to uphold the high standards the law imposes on them,” Mr Price concluded.
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