Directive W-03/2016 - Quality Assurance in Auditing according to BVG

Since 1st January 2017, directive W-03/2016 of the Supervisory Commission for Occupational Pensions is in effect. This is to ensure that fewer errors occur during the audits of occupational pension institutions in the future. To achieve this goal, higher requirements are placed on the lead auditor.

Why was this directive issued? The Supervisory Commission for Occupational Pensions (OAK BV) conducted samples throughout Switzerland in 2015 to check the quality of audits under the Federal Act on Occupational Old Age, Survivors' and Invalidity Pension Provision (BVG). The high error rate observed led them to attribute it to "insufficient practical auditing activity in occupational pensions and lack of knowledge of the legal regulations of the 2nd pillar."

Who is affected by the directive? The directive W-03/2016 applies to those audit offices that are responsible for

• Occupational pension institutions that are subject to the FZG
• Vesting foundations
• Pillar 3a foundations
• Investment foundations
• Safety institutions
• Safety funds

activity within the meaning of Art. 52a – 52c BVG. It also applies to supervisory authorities according to Art. 61 BVG.

What requirements are set for the auditing office?

‍The auditing office must continue to be independent, both in fact and in appearance (Art. 34 VGG 2). In appearance means that an independent third party should not imagine that anything could impede the objective audit. Reasons that lead to the denial of independence include close friendships of the lead auditor with members of the highest governing body or persons with decision-making authority of the audited company or the economic dependence of the auditing office on this mandate. Furthermore, minimum requirements are set for the lead auditor. He must henceforth perform at least 50 billable working hours per calendar year in the field of occupational pensions. In addition, he must complete four hours of further training in this field per calendar year.

The directive took effect from 1st January 2017. There is a transition period of two years.

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