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Electricity Industry Act 2010

Industry participants and consumers - Financial statements of customer and community trusts

101: Auditor of trusts

You could also call this:

“Rules for picking and paying someone to check a community or customer trust's money”

Community trusts and customer trusts need to have an auditor. Every year, the people who benefit from these trusts get to choose an auditor at a special meeting. The auditor’s job lasts until the next year’s meeting.

If the auditor position becomes empty, the trustees can pick someone to fill in until the next meeting. The people at the meeting decide how much to pay the auditor. If the trustees choose an auditor, they decide the pay.

The auditor must be qualified and can’t be someone who works for the trust or a company the trust owns. You can ask the Auditor-General for help in choosing an auditor.

There are special rules about who can be an auditor and how they do their job. These rules come from the Financial Reporting Act 2013 and the Companies Act 1993. The laws treat the trust like a company, the trustees like company directors, and the people who benefit from the trust like company shareholders.

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This page was last updated on

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM2634503.

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Part 4 Industry participants and consumers
Financial statements of customer and community trusts

101Auditor of trusts

  1. The trustees of a community trust and the trustees of a customer trust must, in each financial year, hold an annual meeting of beneficiaries at which the beneficiaries appoint an auditor to hold office from the conclusion of that meeting until the conclusion of the next annual meeting of beneficiaries.

  2. The trustees may fill any casual vacancy in the office of auditor by appointing an auditor to hold office until the conclusion of the next annual meeting of beneficiaries (but, while the vacancy remains, the surviving or continuing auditor, if any, may continue to act as auditor).

  3. The fees and expenses of the auditor must be fixed—

  4. at the annual meeting of beneficiaries or in the way the beneficiaries determine at the meeting, if the auditor is appointed at the annual meeting:
    1. by the trustees, if the auditor is appointed by the trustees.

      1. An auditor of a customer trust or community trust—

      2. must be a qualified auditor (within the meaning of section 35 of the Financial Reporting Act 2013) and, in selecting an auditor, the beneficiaries may seek the advice of the Auditor-General:
        1. must not be a trustee, a director, an employee, or an agent of the trust or of any distributor owned by the trust, or be otherwise disqualified from being an auditor under section 36(4)(b) and (d) of the Financial Reporting Act 2013.

          1. See sections 37 to 39 of the Financial Reporting Act 2013 (which provide for the appointment of a partnership and access to information in relation to a customer trust or community trust).

          2. In addition, sections 207B and 207T to 207W of the Companies Act 1993 apply in relation to the auditor.

          3. Those sections of the Companies Act 1993 apply as if references to a company were to a trust, references to a director were to a trustee, references to a board were to the trustees, references to shareholders were to beneficiaries, references to a subsidiary were to a distributor owned by the trust and the distributor's subsidiaries, and all other necessary modifications were made.

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          Notes
          • Section 101(4): replaced, on , by section 126 of the Financial Reporting (Amendments to Other Enactments) Act 2013 (2013 No 102).
          • Section 101(5): replaced, on , by section 126 of the Financial Reporting (Amendments to Other Enactments) Act 2013 (2013 No 102).
          • Section 101(6): replaced, on , by section 126 of the Financial Reporting (Amendments to Other Enactments) Act 2013 (2013 No 102).
          • Section 101(7): inserted, on , by section 126 of the Financial Reporting (Amendments to Other Enactments) Act 2013 (2013 No 102).