New Zealand's Financial Markets Authority has released its auditor regulation and oversight plan for 2016, which sets out a new style of audit report issued by the External Reporting Board.

The idea behind the new auditor's report structure is to provide better information to investors. It includes new standards for listed entities.

An auditor will be required to communicate key audit matters and his report will include the name of the engagement partner. Every auditor has to report on significant matters in the audit of the financial statements, explaining why the matter was significant and how the matter was addressed by his audit work. This is expected to improve the information available for investors.

The new auditor’s report also gives auditors the opportunity to explain their work and to provide additional information, and the FMA is expecting wildly divergent reporting as a result of the diversity of business.

The 2016 oversight plan, aimed at auditors, preparers of financial statements and directors of Financial Markets Conduct reporting entities, details the main areas of focus for the FMA over the next three years with the intent to improve audit quality and to induce foreign governments and firms to form a higher opinion of New Zealand's auditors. The FMA also explains how it will perform the audit quality reviews in-house as these have previously been done by the New Zealand Institute of Chartered Accountants.