When Documentation Deceives: Strengthening SMSF Audit Defences Against Fraud

The SMSF audit landscape has always demanded due diligence—but in the wake of high-profile cases like ASIC v Caddick [2021] FCA 1443, the stakes are even higher. As digital manipulation becomes more sophisticated and fund documentation appears increasingly professional, auditors must sharpen their scrutiny and update their processes accordingly.

In Session 9 of our program, Beware Fraudulent Documentation – It’s Getting Harder to Identify, SMSF audit expert Sharlene Anderson (Consultant, Veritas Audit) delves into how auditors can respond to the increasing risks of deception in fund documentation. This is an essential SMSF Audit CPD topic that addresses not just technical audit processes, but auditor liability and professional judgment.

The Caddick Case – A Cautionary Tale

The Melissa Caddick case exposed how fraudulent documentation can circulate undetected for years—until it’s too late. Auditors were thrust into the spotlight for failing to identify false reports, sparking important questions around the level of verification required. This session explores the specific audit steps that could have mitigated risk and potentially prevented negligence claims.

What You’ll Learn in This SMSF Audit CPD Session:

• Audit Vulnerabilities Exposed by the Caddick Case: Understand how SMSF auditors became targets of scrutiny, and what audit safeguards might have altered the outcome.
   
• Digital Deception – The New Normal: Discover how today’s technology makes it easier to falsify seemingly legitimate documents—and why traditional checks may not be enough.
   
• What to Question in Trustee and Advisor Documentation: Gain insight into what red flags auditors should look for when reviewing documents sourced directly from trustees or their advisors.
   
• Verifying Asset Existence and Market Valuations: Learn the audit processes that go beyond paper to confirm whether assets truly exist, and whether their values stack up.
   
• Auditing Digital and Emerging Assets: From unlisted unit trusts to digital investments, this session outlines how to audit these complex assets without falling into the same traps.
   
• Audit Independence Under Pressure: Explore how over-reliance on a single referral source (e.g., one accounting firm) could raise independence concerns—and how to stay within professional standards.
   
• PI Insurance: Are You Covered?: An honest look at the limitations of professional indemnity insurance when it comes to legal action arising from failed audits.
   
• Audit Expectations vs. Fee Pressures: With the ATO expecting more rigour in audits, and fee competition on the rise, auditors must balance compliance expectations with commercial realities.
   

Find out more about The 13th Annual SMSF Audit Conference