---
title: "ASIC Says EY and PwC Signed Off on $80 Billion of Super Assets Without Enough Proof"
description: "A year after its first warning, the regulator finds auditors still accepting private asset values on trust, and members’ balances depend on them"
author: "Jan Sokol"
published: 2026-10-13T13:01:00Z
modified: 2026-10-13T16:03:39Z
url: https://rews.cc/a/asic-says-ey-and-pwc-signed-off-on-80-billion-of-super-asset-d60f73
language: en
tags: ["superannuation", "audit", "pwc", "ey", "private-credit", "business"]
publisher: "Rews (https://rews.cc)"
---

# ASIC Says EY and PwC Signed Off on $80 Billion of Super Assets Without Enough Proof

*A year after its first warning, the regulator finds auditors still accepting private asset values on trust, and members’ balances depend on them*

By Jan Sokol · October 13, 2026 · https://rews.cc/a/asic-says-ey-and-pwc-signed-off-on-80-billion-of-super-asset-d60f73

## In brief

- ASIC reviewed more than 40 super trustees and six audit reports by Deloitte, KPMG, BDO, EY and PwC
- ASIC says EY and PwC certified $80 billion of private investments, about 29% of $275 billion reviewed, without required evidence
- $67 billion of the problem valuations were tied to externally managed assets, including private credit loans
- A 2025 ASIC review found similar audit failures covering $102.5 billion of unlisted investments
- EY stood by its work but acknowledged higher expectations; PwC said it would work with ASIC on audit quality

In Australia a worker’s retirement is expressed as a price. Members of a superannuation fund can buy in or sell out at any time, and they do it at a unit price meant to reflect what the fund owns. When a fund owns listed shares, the market supplies that number every trading day. When it owns infrastructure, real estate or a private loan, no market supplies it. Someone has to estimate it, and then someone else has to check the estimate.

The whole arrangement depends on that second person. Kate O’Rourke, a commissioner at the Australian Securities and Investments Commission, described the chain of trust plainly: “You’re relying on the trustee to discharge their duties and you’re relying on the auditor, who has looked as the independent professional checker of the valuations, to have confidence that the numbers are reliable.”

On Wednesday the regulator said that in a large share of cases the checker had not done enough checking. As [Lucas Baird reported in *The Australian Financial Review*](https://afr.com/companies/financial-services/ey-pwc-ticked-off-80b-in-private-assets-without-enough-proof-asic-20261014-p614zf), ASIC reviewed more than 40 superannuation trustees and six audit reports produced by Deloitte, KPMG, BDO, EY and PwC. [Finimize put the number of funds at 42](https://finimize.com/content/asic-flags-valuation-blind-spots-in-australias-pension-funds), drawn from a retirement system worth A$4.8 trillion.

## Eighty billion, taken on faith

ASIC singled out two firms. EY and PwC, it said, had certified the value of $80 billion of private investments without the required evidence. That is about 29 per cent of the $275 billion in assets covered by the audit reports in question. Of the $80 billion, $67 billion was tied to externally managed assets, private credit loans among them. In practice, an outside manager reported a value and the value passed through the audit unproven.

![A dark blue rubber stamp rests on a cream-colored box with a red check mark, against a bright blue background.](https://rews.cc/img/7966712bae29a8f993c47f362e0067d1313f3f8e.webp)

The report put it in the dry language regulators use: auditors “did not sufficiently address the valuation risk associated with unlisted investments and were not adequate to obtain sufficient appropriate audit evidence to support the year-end valuations.”

## The warning that came before

None of this is new to the firms. In September 2025 ASIC published its first review of superannuation reporting, *Accounting for your super*. It examined 60 fund financial reports for the year to 30 June 2024 and five audit files, one from each of the large firms that audit most funds. According to [the regulator’s announcement at the time](https://www.asic.gov.au/about-asic/news-centre/find-a-media-release/2025-releases/25-220mr-review-finds-greater-uplift-needed-in-quality-of-super-fund-financial-reports-and-audits), auditors had not gathered enough evidence to support valuations, and the funds’ size had led them to set high materiality thresholds, which can mean less testing. O’Rourke said then that “some auditors also did not adequately challenge the valuations provided by fund managers of managed investment schemes”, and ASIC sent comment forms to four auditors. [The full report](https://download.asic.gov.au/media/isqbtcyj/rep816-published-30-september-2025.pdf) found that in four of the five files auditors had not obtained reasonable assurance over unlisted investments worth $102.5 billion, 36 per cent of the $286 billion surveyed.

A year later the regulator says it still sees similar problems. The amount in question has fallen and the share is lower, but the practice is unchanged: the outside manager’s number is accepted, and the audit signature goes on top of it.

A reflection, not a finding: large institutions seldom fail through a single dramatic act. More often they fail through a routine that nobody is paid to question.

![A magnifying glass with a closed eye inside hovers over a conveyor belt carrying cream-colored sheets against a bright blue background.](https://rews.cc/img/d627776dc0dfb55dc27de2e4c35e8c9c45e6b338.webp)

## The firms answer

An EY spokesman said the firm stood by the quality of its work and had followed EY’s global audit methodology when reviewing valuations. “We nevertheless acknowledge ASIC’s increased expectations for evidence in supporting asset valuations,” he said, adding that EY was working with clients to obtain additional evidence “where it is available, including information from external fund managers, custodians, underlying investment entities or their auditors.” He said the firm remained committed to working constructively with regulators.

PwC Australia said it would work with ASIC to improve audit quality. “Maintaining confidence in the integrity of financial reporting for superannuation members and stakeholders is critical, and the audit industry plays an important role,” the firm said.

## Two hundred billion dollars in private loans

O’Rourke tied the findings to ASIC’s continuing scrutiny of the $200 billion private credit market. The regulator has repeatedly criticised lenders for refusing to mark down distressed loans, which inflates the fees charged to investors. It has already told super trustees and institutional investors not to “treat private credit as an easy, high-yielding substitute for traditional fixed-income investments while accepting manager marks at face value.”

Banks have raised the same concern. Earlier this year, at an annual meeting hosted by the *Financial Review* and Visy chairman Anthony Pratt, Westpac chief executive Anthony Miller urged super funds not to rush into private corporate lending, warning that it could expose members to a sharp downturn. “We have not had a good, old-fashioned credit meltdown for a very long time,” he said. “We’re not match fit on what happens when you have serious levels of defaults.”

![A cream piggy bank stands on a bending yellow plank extending from a dark support over jagged dark spikes against a bright blue background.](https://rews.cc/img/79a47fc1c9b7fa440bca4d8518a0995abe805d2c.webp)

Miller said super funds, unlike banks, have little experience of liquidity strain, when assets must be sold quickly to pay members who want their savings. “They’re not equipped to deal with it in the same way the banks are, and that’s the catch-up that needs to be worked on,” he said.

## When the information is withheld

ASIC said funds too often rely on external managers to provide fair valuations, “which may limit their ability to review and challenge significant valuation assumptions and estimates.” It asked trustees and auditors to work together to improve audit quality, solve the practical problems of reaching underlying asset information, and help auditors gather enough evidence to form opinions on valuations. Superannuation entities remain on ASIC’s list of [financial reporting and audit focus areas for 2026–27](https://www.asic.gov.au/about-asic/news-centre/find-a-media-release/2026-releases/26-098mr-asic-sets-financial-reporting-audit-and-sustainability-focus-areas-for-fy-2026-27/).

The regulator also told auditors to plan for an awkward possibility: that a fund or an external manager will not hand over what is needed to value an asset properly, or will refuse access on “legal, contractual or confidentiality” grounds. The firms that sign the accounts are being told to prepare for the case where the asset’s owner will not show them the asset.

For the member, who sees none of this, O’Rourke explained what is at stake. “For a member, it matters because it goes to their balance, the fees that they are charged and the performance of their fund.”