The FSCA recently published a draft exemption in terms of the Collective Investment Schemes Control Act (CISCA). The draft exemption proposes to exempt managers and auditors of collective investment schemes (CIS) from the application of section 74(1)(a) and 2(c) of the CISCA, which determines the accounting standard to be applied by managers and auditors of CIS portfolios.
Currently CISCA requires the manager and auditor of a CIS to ensure that accounting records are maintained, and annual financial statements are prepared in conformity with ‘generally accepted accounting practice’ (GAAP). However, since 1 December 2012, GAAP no longer applies as a standard in South Africa. No further regulated requirement exists with regards to an accounting and auditing standard for a collective investment scheme and its portfolios.
The exemption is aimed at facilitating the implementation of alternative accounting standards for managers and collective investment schemes in South Africa in order to ensure alignment with South African accounting practices international standards for accounting.
The draft exemption was published together with FSCA Communication 1 of 2019 (CISCA) which sets out the background and content of the exemption together with an invitation to comment on the draft.
Interested parties are invited to submit comments on the draft Exemption Notice to Marius.DeJongh@fsca.co.za by 29 November 2019.