Do sole traders need to comply with Australian Auditing Standards (ASA)?

Only if a further fact applies. Looking in accountants & bookkeepers and every size band, the engine's answer for a sole trader is: only if a further fact applies.

Do businesses with 1–5 employees need to comply with Australian Auditing Standards (ASA)?

Only if a further fact applies (1–5 employees, turnover $100K–$1M).

When is "Comply with Australian Auditing Standards (ASA)" due?

Throughout every audit or review engagement, applying the auditing standards in force for the reporting period (a standard applies to periods ending after it commences, or from a later date it specifies).

Who must comply with Australian Auditing Standards (ASA)?

The applicability test for Comply with Australian Auditing Standards (ASA) (ASIC), computed across 35 industries, 9 business structures and 6 size bands.

Short answer: Only if

Applies only if you are a registered company auditor or conduct audits. Whether it applies turns on a fact that no industry, structure or size settles on its own.

What the obligation is

Auditors must conduct audits per ASA — Aus equivalent of ISA, with Aus additions.

Section 307A of the Corporations Act 2001 requires an individual auditor or audit company that audits or reviews an annual or half-year financial report to conduct the audit or review in accordance with the auditing standards; where an audit firm or audit company is engaged, the lead auditor must ensure this. The auditing standards are made by the Auditing and Assurance Standards Board (AUASB) as legislative instruments under s 336, and have been legally enforceable since July 2006. The Australian Auditing Standards (ASAs) set the auditor's responsibilities for audits of financial reports and other historical financial information; separate AUASB standards cover review engagements, other assurance engagements, related services and, now, sustainability assurance (s 307AB for Corporations Act sustainability reports). ASIC administers audit quality and auditor independence and runs audit inspection and surveillance programs.

The applicability test

Applies only if you are a registered company auditor or conduct audits. Whether it applies turns on a fact that no industry, structure or size settles on its own.

How the regulator frames it: Individual auditors, audit firms (through the lead auditor) and authorised audit companies conducting an audit or review of a financial report under Part 2M.3 of the Corporations Act. The duty in s 307A(1) sits on the individual auditor or audit company conducting the audit; where an audit firm or audit company conducts it, s 307A(2) also makes the lead auditor responsible.

What triggers it: Accepting and conducting an audit or review of an annual or half-year financial report required by the Corporations Act.

Jurisdiction: Commonwealth law, so the test is the same in every state and territory.

Which industries are in or out

Outcome across the 35 industries Rules Mate maps (1 of 35: only if a further fact applies; 34 of 35: no).

Industry	Answer
Accountants & bookkeepers	Only if a further fact applies
No	34 other industries

Business structure and size

Structure does not change the answer in accountants & bookkeepers: for every structure the answer is "only if a further fact applies".

Size does not change the answer in accountants & bookkeepers: at every size band the answer is "only if a further fact applies".

Worked examples

Each line is one run of the Rules Mate applicability engine for a single business profile, with the reason the engine gives:

Pty Ltd company in real estate agents with 6–19 employees, turnover $1M–$3M: does not apply. Requires a trigger outside this questionnaire.
Pty Ltd company in accountants & bookkeepers with 6–19 employees, turnover $1M–$3M: check whether it applies. applies only if you are a registered company auditor or conduct audits.

When you need to check further

The engine shows this obligation as "check whether this applies" when a business has industry: Accountants & bookkeepers. It then applies only if you are a registered company auditor or conduct audits. That fact is not something Rules Mate can infer from industry, structure or size.

What you must do, and when

When due: Throughout every audit or review engagement, applying the auditing standards in force for the reporting period (a standard applies to periods ending after it commences, or from a later date it specifies).
Frequency: Ongoing
Evidence to keep: Audit file documenting planning, risk assessment, evidence and conclusions under the ASAs; engagement letter; auditor's independence declaration and independence assessment; quality management documentation; lead auditor review and sign-off; auditor's report in the form the standards require.
Status: Current
Priority: High

Penalty for not complying

Maximum penalty: Contravening s 307A(1) or (2) is an offence: the fault-based offence carries up to 2 years imprisonment (s 307A(3)) and the strict liability offence 50 penalty units, $18,200 (s 307A(4)) (Corporations Act Schedule 3). ASIC can also take enforcement action where its audit oversight identifies significant non-compliance.

Criminal liability

Breaches can be prosecuted as criminal offences, not only civil contraventions.

Audit or assurance level

Rules Mate has not yet classified the audit or assurance level for this obligation. Any audit, review or certification requirement is set by the regulator source listed below.

Obligations with the same applicability test

If this obligation applies to you, so does this one: the engine uses the same rule for each.

Registered Company Auditor (RCA) registration + CPD (RG 260)

Where it sits in the corpus

Rules Mate tracks 2 published obligations tagged "auditor", 0 of them rated critical. For a professional services Pty Ltd company with 6–19 employees operating in every state, 0 of those apply outright. This obligation is rated high priority and carries criminal liability, and is an ongoing duty.

Regulator, legislation and tools

Regulated by Australian Securities and Investments Commission.

ASIC: Corporate regulator administering the Corporations Act, financial services and credit licensing (AFSL/ACL), markets supervision, insolvency, and registries (ASIC and ABRS).

Australian Securities and Investments Commission

Corporations Act: The foundational federal Act for Australian corporate law.

Corporations Act 2001

Free tools that help with this obligation:

Compliance calendar builder

Run the compliance journeyAnswer a short questionnaire about your business and get the obligations that apply to you, with the reason each one applies.

Questions

Who must comply with Australian Auditing Standards (ASA)?: Applies only if you are a registered company auditor or conduct audits. Whether it applies turns on a fact that no industry, structure or size settles on its own.
Do sole traders need to comply with Australian Auditing Standards (ASA)?: Only if a further fact applies. Looking in accountants & bookkeepers and every size band, the engine's answer for a sole trader is: only if a further fact applies.
Do businesses with 1–5 employees need to comply with Australian Auditing Standards (ASA)?: Only if a further fact applies (1–5 employees, turnover $100K–$1M).
When is "Comply with Australian Auditing Standards (ASA)" due?: Throughout every audit or review engagement, applying the auditing standards in force for the reporting period (a standard applies to periods ending after it commences, or from a later date it specifies).

Sources

Computed by the Rules Mate applicability engine from the published obligation corpus; facts last checked 3 October 2026. Rules Mate is not a law firm and this is general information, not legal advice. Confirm your position with the regulator source or a qualified adviser before acting.